Recession

In mid-December 2022, economists and strategists in the Global Research Department of the Boao Forum for Asia believed that the United States, the Eurozone and the United Kingdom would all experience a recession.。

This forecast is almost a reality in the UK, where the economy is flat but still in recession due to increased business investment in the first half of the year, while the situation in the eurozone is less clear, with the economy contracting for two consecutive quarters, but in terms of broader data (including unemployment figures), it is only a "technical" recession.。

The better-than-expected employment data also means that the widely predicted U.S. recession did not materialize and the economy grew faster than expected.。

bank dilemma

Pessimistic forecasts for the banking sector prove to be more prescient。Previous warnings that rising interest rates and international political tensions will worsen conditions in the banking sector in 2023, with multiple bank failures within the first quarter despite a variety of causes.。

The Bank for International Settlements describes the banking turmoil that began in March 2023 as the largest system-wide banking stress since the Great Financial Crisis.。Silicon Valley Bank collapsed due to poor bond investment decisions, while Silver Gate Bank and Signature Bank collapsed due to volatility in the cryptocurrency market.。

The biggest victim was Credit Suisse, whose years of scandal eventually led to massive deposit withdrawals and which had to be rescued by UBS.。Acknowledging 'material flaws' in 2021 and 2022 financial reporting is almost the last straw。

Argentina and Brazil: Monetary Union

Earlier this year, Argentina began discussions with Brazil on monetary union。According to the Centre for Strategic and International Studies, the proposal could make economic sense if basic macroeconomic, legal and political conditions were met.。

Many observers noted that the real goal was to reduce Argentina's dependence on the dollar, but political events since then have shifted the focus firmly from de-dollarization to green cards.。

Far-right economist Javier Milei initially had mediocre results, but he was elected in October's presidential election.。Of course, there is no guarantee that Milei will make good on its promise to eliminate Argentina's central bank and local currency, but many believe it will help stabilize an economy that has seen inflation accelerate and the peso depreciate this year.。

ETF Sentiment Rises

At the end of 2023, bullish sentiment in the ETF market was high.。Oliver Wyman believes the ETF market is entering a new phase of growth, driven by the rise of active ETFs, while State Street Securities believes ETFs will continue to innovate and grow。

These positive predictions have become a reality due to the increased supply of active ETFs and the growing recognition by investors of the merits of these funds, especially in terms of cost comparisons with active open-end funds.。Earlier this month, Morningstar noted that investors poured $110 billion into U.S. exchange-traded funds in November alone, and even high-yield bond ETFs reversed a year of outflows to a record $11 billion.。

Cross-border payments

The cost and convenience of cross-border payments remains a pressing issue for businesses。Last year, the G20 pledged to improve existing payment infrastructure to support requirements for cross-border payment markets by 2023.。

In a progress report released in October, the FSB cited "encouraging progress," but also acknowledged that much remains to be done and that "continued action and commitment from both the public and private sectors is needed."。

In October, ECB executive board member Fabio Panetta said cross-border payments were still too expensive and sluggish, and while domestic payments were becoming instant and digital, cross-border payments had yet to benefit from the transformative power of digital technology.。

Crash of FTX

In the cryptocurrency space, where the headlines at the end of last year were dominated by the collapse of FTX, Bob Mason believes there is always a threat of other cryptocurrency exchanges failing due to liquidity crunch and bank runs, which will be a factor in the first half of 2023.。

Others believe the spread can be controlled.。Chainalysis acknowledged that industry backbones like FTX could go out of business unexpectedly, which is a huge negative development for cryptocurrencies, but "cryptocurrencies have survived events like this, become stronger, and continue to hit new highs."。

While many cryptocurrency-related businesses (including Genesis Global Capital, Gemini, BlockFi, and the Silvergate and Signature banks mentioned above) have been negatively impacted by the collapse of FTX - trading volume on centralized exchanges fell by more than 20% in the third quarter - there have been no high-profile exchange failures this year.。

Institutionalization of digital asset market

The digital asset market will continue to be institutionalized, and Guotai Junan is just one of the institutions that mentioned that mature financial institutions entered the cryptocurrency industry more at the end of last year.。

Coinbase's 2023 Digital Asset Outlook Survey found that a third of institutional investors increased their allocations to cryptocurrencies this year.。In the 2022 survey, only 8 percent of respondents said they expect cryptocurrency prices to trend upward in 2023, while 57 percent expect prices to rise next year.。According to the survey of respondents, cryptocurrencies are currently in third place after private equity and U.S. stocks, and are the best source of risk-adjusted returns in 2024.。

Earlier this year, Nitin Gaur, global head of technology and asset design at State Street Digital, expressed the hope that the development of regulation and increased government oversight would provide more clarity and stability to the cryptocurrency market.。

Cryptocurrency Regulation

It is widely predicted that the United States and Europe will take a big step forward in cryptocurrency regulation in 2023。However, despite widespread reports that the U.S. Securities and Exchange Commission (SEC) intends to approve a Bitcoin spot-traded fund early next year, progress in the U.S. has been hampered by a lack of joint thinking among major regulators.。

The situation is similar in Europe, although the Regulation on the Supervision of the Cryptoassets Market (MiCA) came into effect in June.。The third and final consultation package of the regulation will not be published until at least the first quarter of next year, which is very important because the package will cover important tasks within the 18-month period, including the qualification of crypto assets as financial instruments, the monitoring, detection and notification of market abuse, and investor protection, such as advising and the suitability of portfolio management services.。