Workers of Samsung Electronics Vietnam Co., Ltd., Yen Phong industrial park, Bac Ninh province, check products during their work shift. (Photo: VNA) James Cheo, Chief Investment Officer, Southeast Asia and India,Global Private Banking and Wealth, HSBC, said that the strength of the Vietnameconomy in 2024 would come from a combination of consumer and investmentspending.
The strong inflows of foreign direct investment will likelycontinue in 2024, buttressing Vietnam’s manufacturing sector. The nascentrecovery of the global trade cycle will boost Vietnam’s exports. Furthermore, Vietnamis likely to witness a gradual uptick in international tourism.
“Inflation is fairly stable but there could be an upside risk fromhigher-than-expected energy or food prices, we think that Vietnam’s monetaryauthority will stay vigilant and keep policy rates on hold for this year. Weforecast the Vietnamese dong tomove towards 24,400 VND against the US dollar by the end of 2024,” said Cheo.
HSBC Global Private Banking (HSBC GPB) expects the beginning ofFed rate cuts in June 2024, US soft landing, corporate earnings recovery, andsolid Asia growth to improve global risk appetite and investment outlook ofequity and bond markets in 2024.
For the next six months, HSBC GPB adopts a mild risk-on investmentstrategy with underweight on cash, mild overweight on US Treasuries and globalinvestment grade bonds and tactical overweight on hedge funds.
“As we look ahead into 2024, we see two positive driverssupporting global financial markets. Major western central banks have done ratehikes amid continued disinflation and the US economy is heading for a softlanding. These two positive developments should support recovery of global riskappetite in 2024. Positioning for slower but positive global growth and Fedrate cuts starting in June 2024, putting cash to work in quality bonds, US andAsian equities and alternatives should deliver diverse sources of return andincome to optimise portfolio performance and mitigate market volatility,” saidFan Cheuk Wan, Chief Investment Officer, Asia, Global Private Banking andWealth, HSBC.
“We see quality bonds as the most attractive asset class forH1/2024 ahead of the first Fed rate cut. We focus on locking in stillattractive yields via our overweight in US and UK government bonds andinvestment grade bonds across developed and emerging markets. Although globalgrowth should remain below trend growth in 2024, the US growth engine continuesto run, thanks to the resilient US consumer and government stimulus supportinginvestment and innovation in technology and healthcare. Equity valuations nowsee better fundamental support from earnings recovery that we anticipate in2024, which provides a potential upside for stocks that can deliver on earningsexpectations. We expect the global AI investment boom will extend into 2024,reinforcing our bullish view on the global, US and Asian IT sectors,” notedFan.
“Going against the global headwinds, Asia’s robust private wealthaccumulation, resilient middle-class consumers, digital transformation andgreen transition offer solid domestic drivers to support healthy economicgrowth. We forecasted that Asia ex-Japan GDP will grow 4.5% in 2024, close todouble the average global growth of 2.4%, led by India’s 6.0%, Indonesia’s 5.2%,and China’s 4.9% growth this year.” added Fan./.
VNA
