New York tends to lead London by at least a few months when it comes to cycles in the worlds of both finance and communications, so it’s always interesting – and valuable – to get a perspective on the 2024 outlook from ‘across the pond’.

With this in mind, our Managing Director Julian Rea compared notes with longtime Liminal friend Andrew Healy the New York-based c0-founder and Partner at specialist financial communications firm Water & Wall, to consider a couple of the top trends for US and UK financial and communications markets in the year ahead.

Andrew on AI

You’d be hard pressed to find an innovation that rocked the world more in 2023 than AI, and all signs point to the momentum increasing in the new year.

While ChatGPT caught the world’s attention in late ‘22, finance has been using AI and machine learning for years to better analyze data and support clients and customers in efficient ways. And yet it’s undeniable how important last year was for AI advancements and technology stocks.

We’re still in the early innings of this race, but Wall Street is hard at work looking for new ways to use AI to increase productivity and boost profits (McKinsey thinks AI can add $340 billion to bank earnings annually), and this will be a dominant theme in 2024 for everyone from asset managers to financial advisors to fintechs, and more.

Looking beyond the economic and markets impact, financial marketing pros are testing out different ways to incorporate AI into their daily work in a variety of ways, including content creation, analyzing online conversations, supporting research efforts, and creating media lists/pitches instantly, to name a few.

A recent survey by PR software platform, Prowly, highlights several areas where AI can support comms professionals, with almost 8 out of 10 saying that AI will automate repetitive tasks, freeing up more time for strategic works.

We’ve tested out a few AI offerings at Water and Wall this year and while the results have been mixed, we’re encouraged and excited about what will come and how we can increasingly and more effectively use AI as a co-pilot to better serve financial brands.

Julian on private debt

On the asset class side, I expect private markets, and especially private debt, to be one of the big stories for 2024 in the British financial press.

Already a big story in the US, which still accounts for 75% of fundraising, private debt has attracted a lot of attention over here in the last few of months. However in the UK, and Europe more broadly, there’s a sense that transaction levels haven’t fully caught up to the hype yet. This is largely because it’s proved easier to raise funds than deploy them, with competition for the good deals heating up as more funds step into the space. But most anticipate more of this dry powder will be put to work in 2024.

There’s going to be a major debt refinancing window in the first half of the new year, and it will be interesting to see the role private credit plays in plugging gaps that traditional banks may no longer have the stomach for. At the same time, we can expect to see defaults rise as corporates struggle to digest higher interest rates.

Watching over all this will be the regulators, with the Bank of England already warning this month that private credit and leveraged lending markets are vulnerable to “sharp revaluations.” But this is a risk many investors will be willing to take on as this asset class continues to gather momentum.

Elections

2024 will be an election year in the UK, with current polls indicating a win for Kier Stermer’s Labour Party, bringing an end to 13 years of Conservative rule. However, victory is far from certain, and will require a swing towards Labour greater than that achieved by Tony Blair in his famous 1997 landslide victory.

One area where Labour is working particularly hard to shore up support is in presenting itself as a reliable friend to business and finance, and a safe pair of hands to steer the economy in the years ahead. Traditionally this has been the domain of the Conservatives, though their reputation here has been heavily tarnished in recent years.

Starmer has spoken of “unleashing” the financial sector to drive economic growth and strengthen the City’s role as a financial centre, as well as being “pro-business, pro-worker”.

Along the way he, and his Shadow Chancellor, Rachel Reeves, have garnered endorsements from heavyweights including Larry Fink and Mark Carney.

Whichever party ends up winning on election night, it seems likely that stabilising and then strengthening Britain’s corporate and financial sector will be an early priority, so there’s plenty to watch out for.

On the US end, get ready for the wildest election of all time. Both major political parties have already started their respective campaigns and regardless of who will be on the ballot next November, it’s safe to say it will be the year’s main story. And yet while the outcome will of course have implications for the financial services industry, one of the main themes keeping financial marketers awake at night will continue to be the economy.

The US avoided a recession in 2023 despite most experts calling for one, and while there still may be one on the horizon, recent data suggests the Fed’s efforts are finally making a dent on inflation. Any reduction in rates and/or recession fears will be well-received by firms across the financial landscape, which should speak well for marketing budgets and plans.