Major U.S. insurers ‘ top investment and finance executives have pinpointed ‘U.S. economic slowdown and recession’ as a macroeconomic risk that could impact investment portfolios this year.
Goldman Sachs Asset Management disclosed the results of a survey conducted among 359 Chief Investment Officers (CIOs) and Chief Financial Officers (CFOs) of U.S. insurance companies on the 3rd.
Of the respondents surveyed from January 17th to February 9th, 52% identified ‘U.S. economic slowdown and recession’ as the primary risk for this year, marking the highest percentage, including multiple responses.
Following closely was ‘credit and stock market volatility’ at 48%, with 46% of respondents citing ‘geopolitical tension.’ The responses also indicated concerns about ‘inflation’ (42%) and ‘monetary tightening’ (27%).
However, ‘China’s economic slowdown and recession’ appeared relatively low, with only 7% of all respondents expressing concern.
Additionally, 83% of respondents predicted that by the end of the year, the U.S. 10-year Treasury yield would reach the level of 3.90% to 4.10%, which was the rate at the time of the survey.
Among the respondents, 53% identified ‘private credit’ as the investment asset expected to yield high returns over the next year. This was followed by U.S. stocks (46%), government and public institution bonds (34%), investment-grade private company bonds (33%), developed market investment-grade corporate bonds (31%), and private funds (31%).
Alexandra Wilson-Elizondo, co-CIO of the Multi-Asset Solutions division at Goldman Sachs Asset Management, mentioned, “We anticipate central banks to gradually adopt a monetary easing strategy in the second half of the year,” adding, “We believe such a strategy will favor risk assets across bonds and stocks.”
She further commented, “However, considering the expansion of macroeconomic risks and the upcoming U.S. presidential election, there is a possibility of increased volatility and significant deviations in year-end returns.”
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