2021 Outlook

Long-term perspective on markets and economies

CE credit webinar: 2021 Outlook

Capital Group investment professionals discuss the year ahead for global markets and economies.

Turning points on the road to recovery

We may one day look back on 2021 as a major turning point for the global economy, public health, politics and the digital age. This 2021 Outlook puts the coming year in perspective.

Economic growth is making a comeback

Growth will bounce back for major economies in 2021, according to the International Monetary Fund. But “all forecasts depend on the trajectory of the coronavirus vaccines,” says economist Jared Franz.

The image shows real gross domestic product growth in the United States, the eurozone and emerging markets in 2019, 2020 and 2021. GDP figures for 2020 and 2021 are projections. For the U.S., the GDP numbers are 2.2% in 2019, –4.3% in 2020 and 3.1% in 2021. For the eurozone, the GDP numbers are 1.3% in 2019, –8.3% in 2020 and 5.2% in 2021. For emerging markets, the GDP numbers are 3.7% in 2019, –3.3% in 2020 and 6.0% in 2021. Source: International Monetary Fund, World Economic Outlook, October 2020.
U.S. OUTLOOK

The future is here, and it’s digital

Digital leaders across industries are leaping ahead of the competition, disrupting the status quo as consumers rapidly form new habits.

Quote from equity portfolio manager Martin Romo: "We just hit the fast-forward button to the future."

Great acceleration reshapes U.S. economic landscape

People were shopping and accessing health care online before COVID, but the pandemic has amplified demand and created opportunity for digitally savvy companies.

INTERNATIONAL OUTLOOK

Think all innovation is in the U.S.? Think again

European and Asian companies are leaders in advancing the use of some of tomorrow’s technology, like renewable energy and digital payments.

The image shows the rapid growth of global digital payments revenue in billions of U.S. dollars from 2016 to 2023 (estimated). The Asia-Pacific region leads, followed by Europe, North America and the rest of the world. Source: World Payments Report 2020 from Capgemini. 2020 to 2023 are estimates. Figures reflect all non-cash payments. No third party whose information is referenced in this report under credit to it, assumes any liability towards the user with respect to its information.

Cash is no longer king

With the U.S. dollar potentially nearing its peak, select innovators abroad might offer compelling investment opportunities.

The image shows the rapid growth of global digital payments revenue in billions of U.S. dollars from 2016 to 2023 (estimated). The Asia-Pacific region leads, followed by Europe, North America and the rest of the world. Source: World Payments Report 2020 from Capgemini. 2020 to 2023 are estimates. Figures reflect all non-cash payments. No third party whose information is referenced in this report under credit to it, assumes any liability towards the user with respect to its information.
FIXED INCOME OUTLOOK

Core bond strength matters when life is uncertain

2020 brought the fastest equity market decline in history, showing how important it is to continue to hold high-quality bonds as a buffer to market volatility.

Strong core allocations remain a smart strategy

With interest rates near zero, investors may be tempted to abandon core bonds. But high-quality bonds have shown positive returns regardless of rates.

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Long-term perspective on markets and economies

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