From Fortune:

The U.S. economy is at a critical point, where strong consumer data could push the Fed to raise rates, and sluggish growth could hurt businesses. But economist Jeremy Siegel believes the economy is at a “Goldilocks pace” that is good for the markets.

The first days of 2024 brought positive numbers for the economy. The number of Americans filing jobless benefits dropped to 202,000, and the job report showed a payroll increase of 216,000. Unemployment remains at 3.7% and average earnings increased 0.4%.

Recent tensions in the Middle East have impacted oil prices and shipping routes, causing concern about supply chain delays and rising costs for companies. Shipping companies are rerouting around the Red Sea following attacks on cargo ships by Houthi rebels.

Despite concerns about rising oil prices and supply chain disruptions, shipping companies, like Maersk, are rerouting around the Red Sea. Analysts fear this will increase costs, but economist Jeremy Siegel seems relatively calm about the issue.

Uncertainty looms over whether the Fed will cut rates in 2024. Economists predicted that rate cuts would begin this year, but Fed chairman Jerome Powell indicated that the base rate is “likely at or near its peak for this tightening cycle,” bringing some relief to the markets.

Economist Jeremy Siegel is not sold on the idea that the Fed will cut rates and believes that if real economic growth stays strong, the Fed could keep rates exactly where they are. He has a generally positive outlook for 2024, predicting an 8-10% price gain for the S&P500 and a 15% appreciation for value stocks.



Read more: Jeremy Siegel on US economy’s ‘Goldilocks’ pace and Fed rate cuts in 2024