As the Head of Macroeconomic Research at Bryn Mawr Trust, Andrew Davis takes pride in being responsible for the company’s macroeconomic views.

His wisdom in portfolio analysis, economic indicators, and options strategies — gained from a career that includes work at SEI Investments, Moody’s Analytics, and the U.S. Bureau of Labor Statistics — enables him to distill the complexities of the financial market into strategic insight that leads to favorable outcomes for clients.

Davis, a Chartered Financial Analyst who grew up in Detroit and earned a bachelor’s degree in Economics from Michigan State and a master’s degree in Applied Economics from Johns Hopkins, hosts a weekly video series where he shares his expertise with thousands of engaged viewers.

“The markets and the economy are ever-changing, making it hard to keep up sometimes,” said Davis, whose work makes sense of it all. “My goal is to help people make informed and strategic investment decisions.”

Davis is tasked with connecting the dots of myriad economic indicators, market trends, fiscal policies, technological advances, demographic changes, environmental factors, international relations, and more in order to formulate Bryn Mawr Trust’s annual economic outlook around this time of year. And he anticipates the unexpected steadiness and growth we experienced in 2023 to set a dynamic stage for 2024.

“The U.S. economy showed remarkable resilience last quarter,” Davis said, pointing to the GDP’s growth of 3.3 percent in Q4, which surpassed the forecasted two percent. “In the U.S., the consumer drives two-thirds of the GDP, and wages are growing at a faster pace than inflation. Wage growth is at 4.5 percent, and inflation is at three percent.”

That 1.5 percent difference flies in the face of negative headlines about inflation and means that consumers have more of a propensity to spend.

“With inflation going back in the box and wage growth restoring purchasing power,” said Davis, “we think the consumer is on solid footing.”

The moderation in inflation, as illustrated by the core PCE (personal consumption expenditures) index being at its lowest since March 2021, is an important bellwether for 2024. The core PCE index is a measure of prices that people living in the U.S., or those buying on their behalf, pay for goods and services.

“Consumer spending is on the rise,” said Davis.

Businesses are also pulling their weight. Despite higher interest rates, gross investment — the total expenditure or investment that is made by a company to acquire capital goods — increased a notable 2.1 percent last quarter.

“This indicates that businesses are still willing to invest, which is a positive sign for the economy,” said Davis.

With 2023 having defied expectations by avoiding a recession and exhibiting robust growth, 2024 is off to an encouraging start.

“We’re currently seeing a blend of strong growth and low inflation, which is often a sweet spot for investment opportunities,” said Davis.

One of the linchpins of his forecast is his belief that the Federal Reserve will be more surgical in cutting rates in 2024.

“Most experts are predicting (the Fed will make) five to six rate cuts this year,” said Davis. “We think there are going to be three. Instead of frantically cutting rates, there will be more of a renormalization, more of a more thoughtful approach.”

With it being a presidential election year, 2024 will introduce a unique set of challenges for forecasting our economic future. However, their impact may not be as significant as often perceived by the media and the general public. After all, economic trends — such as growth cycles, recessions, and recoveries — are influenced by a broader set of factors than political cycles.

Learn more about Andrew Davis, which sectors he believes are poised to be key contributors to earnings growth, and more of what 2024 has in store at Bryn Mawr Trust.