Interest rate expectations to shape the path for private markets in 2024

Adjustment to a new environment

The outlook for private markets will continue dictated by interest rate expectations and uncertainty over economic growth in the coming year, presenting distinct challenges and opportunities for each asset class.

Having flourished during a decade and a half of low interest rates, private market firms are now grappling with a landscape of prolonged higher rates, posing a considerable strain to the space's overall growth and performance. Heading into 2024, Ben Seager-Scott, head of multi-asset funds at Evelyn Partners, said the new year was going to have "more headwinds than tailwinds" for most mainstream private markets, which he argued mostly comes down to higher interest rates.  "[Higher interest rates] both raises the bar for required returns on the dry powder and makes the cost of leverage ...