What Does 2024 Year-End Planning Look Like?

In the October 2024 Market Pulse Webinar, our panelists discussed how the end of 2024 is shaping up. 

Keybridge Research LLC President Robert Wescott, Ph.D., shared a macroeconomic update along with insights on interest rates and possible outcomes from the 2024 U.S. presidential election. 

Later, he was joined by Equifax Risk Advisors Jesse Hardin, Tom O'Neill, David Sojka, and Maria Urtubey to discuss Q4 updates and 2025 economic forecasts.  

Macroeconomic Observations and Updates with Robert Wescott, Ph.D., Keybridge Research LLC¹

The U.S. economy is still on track for a soft landing. The labor market continues to push forward, but consumers are feeling more stressed and hold the key to future growth. The three interconnected themes for the rest of 2024 are the labor market, consumer stress, and Fed activity. 

The Labor Market Is Still Solid

Layoffs are still below pre-pandemic levels, and while the labor market is gradually slowing, it does not show outright weakness. 

Consumers Are Increasingly Stressed

Real consumer spending has been softening throughout 2024 and is weak compared to the past two years. While there is no panic about consumer spending, the downward drift is likely to continue. Consumers are under growing stress as savings dwindle and they struggle to pay off credit card balances. Delinquency rates for credit cards and auto loans continue to drift upward. 

Will Lower Interest Rates Have an Impact in 2024?

The slowing of inflation caused the Fed to feel confident enough to lower interest rates by 0.50%. However, it’s unclear when these rate cuts will start to affect important markets.

During the pandemic, buying cars became much more difficult due to supply chain issues. While it’s improved slightly, car affordability is still below normal and affects consumers. Similarly, high mortgage rates have made buying homes more expensive. The recent rate cuts from the Fed should help potential homebuyers soon.

In the past, when the Fed has cut rates, the housing market has typically improved quickly, while the auto market has taken longer to respond. By looking at past rate cuts, we can understand when we might see changes in home building and car sales. Housing typically reacts quickly, but the auto industry is slower to catch up.

For the full presentation with complete insights, make sure you are signed up for the Market Pulse webinar each month. 

Discussion on Year-End Updates and 2025 Forecasts¹

As we shift into 2024 year-end planning, our experts discussed several economic updates during the October 2024 Market Pulse webinar. Here are the top three key takeaways to prepare you for 2025. 

Takeaway #1: Right now, AI can be a valuable tool to drive responsible innovation.

Although there is still uncertainty around artificial intelligence, it can be a helpful, powerful tool. AI could be compared to driving a car. While cars could cause accidents, we do not stop using cars. We add airbags, seatbelts, and so on. So, given the economic environment we are in, we know that, while there is still much to learn about AI, it can be a force for increasing productivity and responsible innovation. 

Takeaway #2: Consumer debt loads are normalizing.

Although consumer debit is still high, the rate of growth has normalized over the last eight months. When it comes to credit card debt specifically, per yearly trends, it is expected to rise throughout the rest of the year. Overall, delinquency rates have risen, but they are also slowing. Although they are higher than pre-pandemic levels, they could stabilize in 2025. 

Takeaway #3: Worldwide events are having an impact on the U.S. economy.

Events like environmental disasters, while devastating, do not have a large impact on the overall economy because they are temporary. Events like the turmoil in the Middle East, however, could have a more significant and longer lasting impact as they have the potential to quickly put the world economy into a recession. Currently, we are in a wait-and-see situation. 

Stay in the Know 

To receive the full experience and detail from the Market Pulse webinar, you have to be there. We hope you will join us for our November Market Pulse webinar taking place on Thursday, November 14, 2024. We will focus on global trends and how they are impacting U.S. and international markets. 

You can find our monthly Small Business Insights, National Consumer Credit Trends reports, the Market Pulse podcast, and more at our Market Pulse hub. 

Questions? Reach out at riskadvisors@equifax.com. 

Finally, connect with us on YouTube and LinkedIn for even more content to help you focus on forward. 

Sources:

1. Equifax Market Pulse webinar, October 17, 2024 

*The opinions, estimates, and forecasts presented herein are for general information use only. This material is based upon information that we consider to be reliable, but we do not represent that it is accurate or complete. No person should consider distribution of this material as making any representation or warranty with respect to such material and should not rely upon it as such. Equifax does not assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice. The opinions, estimates, forecasts, and other views published herein represent the views of the presenters as of the date indicated and do not necessarily represent the views of Equifax or its management.