- January 1, 2023: Vol. 15, Number 1

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DWS: 2023 return on risk assets should be above inflation

by Jennifer Molloy

“The questions of to what extent and how quickly inflation can be pushed back and how much central banks still need to raise interest rates to do so will be the dominant theme for capital markets in the coming year,” said Björn Jesch, global CIO at DWS, at the DWS Market Outlook 2023 event on 28 November 2022. “We think central banks will keep interest rates high for longer than markets currently expect.” For the US Federal Reserve, Jesch expects it to raise key interest rates to between 5.00 percent and 5.25 percent in 2023, while in the euro zone the key rate is likely to rise to 3.0 percent. “We do not currently see a rate cut next year,” he said. “Inflation rates are expected to fall in 2023 but will still remain at a high level — 6.0 percent in the euro zone and 4.1 percent in the US.”

Geopolitical tensions will continue

Global tensions between the United States, China, Russia and Europe will dominate political and economic eve

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