- Markets expect that 12 months from now, the price will fall to 1.8%, according to Credit Suisse.
- But the rise in prices can last longer than expected if there is no recession.
- Here are 33 stocks that Credit Suisse sees as successful if inflation remains high through 2023.
Credit Suisse says inflation expectations are falling after the Consumer Price Index showed rising prices slightly lower in December.
The market price shows that 12 months from now the inflation rate will be only 1.8% in the US, said Jonathan Golub, the chief US equity strategist of Credit Suisse , told Insider in an interview after the CPI report. That’s a big drop from last month 6.5% increase year over year.
However, many investors seem to be skeptical that the inflation will soon disappear.
“If I were to ask the average person on Wall Street and say, ‘Well, do you believe you’re going to get less than 2% in value a year from now?’ they say, ‘No, I’m going to say that — it sounds crazy,'” Golub said inside.
Those examples show that the Federal Reserve will succeed sooner rather than later in achieving its long-term goal of keeping interest rates below 2%. Just two months ago, a survey conducted by the Philadelphia Fed showed that professional investors wanted the headline CPI rate for Q4 2023 to 2.9%which shows how quickly sentiments about the economy change.
Inflation is also expected to fall around the world. Inflation in the UK is set to fall from a high of 11.1% in October to 4.2% at the end of the year, while inflation in Europe is projected to fall from The latest reading is 10.1% to 3.1% before 2024, according to Credit Suisse.
But, as investors have learned the hard way, information rarely shows up exactly as expected.
Wall Street believed it first cost is not an issue and assume that interest rates will barely leave the near-zero level in 2022. In December 2021, Goldman Sachs called for a Federal Funds rate of 1.9% at the end of 2024, which is more than higher than the futures market price. the time. No one could have guessed that the Fed Funds rate would be fixed between 4.25% and 4.5% within 12 months.
Needless to say, the consensus was this the economy will continue to fall can be proven wrong, especially if the economy avoids a recession, which is what Golub is hoping for.
33 buy to buy while the price remains high
If the climate is hotter than expected or accelerated again in 2023, there are 33 stocks – three in each sector of the S&P 500 – that Credit Suisse believes will be the most profitable. Those stocks are listed below along with the symbol, market capitalization, and share of each.