Business Cycle Analysis and Asset Allocation in Decelerating Growth Phase

As a portfolio manager for a global investment firm, you are tasked with analyzing the implications of the current stage of the business cycle on asset allocation strategies. The economy is currently experiencing a decelerating growth phase characterized by rising unemployment rates, slowing consumer spending, and increased volatility in equity markets.

Discuss how the identified phase of the business cycle impacts the investment decision-making process across different asset classes, including equities, fixed income, and alternatives. In your response, evaluate the historical performance trends associated with this phase of the business cycle and recommend specific asset allocation strategies tailored to navigate the current economic environment.