This year will be one of modest economic growth, but still enough to avoid recession.

It will be a year in which central bankers will be able to drop rates without fears of overheating the economy, according to a 2020 outlook report from Northern Trust.

“The combination of moderate growth and technological innovation will continue to suppress inflation, bolstering the global central bank easing cycle underway,” said the report.

That means that this will be a good year for U.S. equities and high-yield bonds, the report continued.

That was the overall message from Northern Trust officials on Tuesday in Manhattan at an investment strategy press briefing on the report entitled “Everything in Moderation."

“We are not expecting a recession,” said Robert Browne, executive vice president and chief investment officer for Northern Trust. He emphasized that advisors and investors should continue to “be fully invested” in 2020.

Browne added that the United States economy will likely grow by 2% and the stock market will rise by about 7%.

Money, Northern Trust officials say, will continue to be plentiful thanks to an accommodating central bank.

The report predicted two Federal Reserve Bank interest rate cuts and that the 10-year Treasury yield will drop from 2% to 1.5%.

Browne said that the Fed is not “unnecessarily concerned” about inflation. If anything, he said, it was humbled a few years ago about a non-existent inflation problem. The Fed is much more likely to drop rates than raise them.

“The hurdle for cutting is less than the hurdle for hiking,” he said.

And little inflation means, the report said, that U.S. stocks will continue to “deliver solid return with less risk.”

Northern Trust said one should overweight developed markets because of “positive U.S fundamentals. These include modest growth and stuckflation.” That, the report added, gives these regions low risks versus other equity regions.

High yield investments are also attractive. Slow growth, the report said, will be able to overcome trade and political uncertainty.

“Solid fundamentals—including manageable default rates---and constructive technicals, due to strong demand, will make high yields attractive moving forward,” according to the report.

The report also said that in general the best returns will be in non-U.S. developed markets, “particularly in Europe although with elevated risk.”

Northern Trust said inflation linked investments should be underweighted. And cash will once again get trashy.

Part of the prejudice is that, although the Fed recently said more rate cuts are on hold, Northern Trust expects two more rate cuts this year.

“We view cash as an asset class used primarily for meeting near-term liquidity needs, and remain underweight,” according to the report.

Increasing supply and demographics will make it a bad time for inflation linked investments, Northern Trust said. “We view cash as an asset class used primarily for meeting near term liquidity needs and remain underweight.”

Despite the overall good numbers, the moderate growth theme will play out, Northern Trust said, in a period of continuing trade tensions between the United States and China. And it said that, regardless of which party wins the presidency this year, it does not see those tensions lessening