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Last year was my busiest yet, marked by an unprecedented frequency of flights. It was also my third anniversary in the gallery business, a journey that began amidst the pandemic in 2020. Only now am I truly experiencing a gallery’s typical operational pace.

But from a broader perspective, I see three factors that will significantly influence 2024.

A key consideration is whether the U.S. will increase interest rates. The art market is sensitive to higher rates, which exert considerable pressure. Increased investment costs make financial instruments more appealing than art purchases. Buyers face critical decisions in asset allocation, especially when financial strains intensify, as in the latter half of last year.

This challenge is global. In the art world, we’ve seen decline in sales. If U.S. interest rates continue to rise in 2024, collectors will weigh the benefits of interest income against the potential appreciation of art. I recall a client pondering whether to invest $10 million with a bank or in art.

Another significant factor is the ongoing conflicts in various parts of the world, which seem to affect the West more than Asia. It seems to have little to do with the Asian market, but politically, it has caused some peripheral political rifts. It may not be immediately evident to Asian collectors, but the influence is substantial —your political stance also affects support for artists in this region.

Thirdly, the macroeconomic and financial policies of major players like China and the U.S. are pivotal. With China tightening controls in several sectors, there’s speculation about capital redistribution.

I am optimistic about the recovery of China-U.S. relations. Tariffs on Chinese art, often discussed, are less impactful than assumed. Most Chinese artists, with artwork priced below $200,000, are not significantly affected by single-digit tariffs.

In 2023, the market was “blooming at both ends, wilting in the middle,” with very high-value blue-chip works and works around several hundred thousand dollars performing best.

But overall the market has contracted. Auction data, a reliable indicator, shows a universal decline compared to 2022. The Asian gallery sector may not reflect this as markedly, but we will still face a relatively severe 2024.

In 2024, the buyer’s market will continue. While buyers have adjusted their mindset, sellers are still adapting, with many urgently needing funds. This has shifted their focus from profit to selling even at cost.

New collectors continue to enter the market; some are highly affluent. I think there are two situations: one is that they indeed have a lot of surplus funds, as part of an investment portfolio or part of a family asset allocation, or after a certain period post-IPO, they have funds to buy real estate and then art or jewelry. These wealthy new collectors appear every year, coming from industries that have been particularly profitable over the past two or three years. The art market doesn’t need hundreds of new buyers; sometimes just a few people can cause a qualitative change.

Young art enthusiasts, attracted to artists of their generation, are another emerging group. Their preferences for affordable, appealing artworks by same-generational artists are reshaping the artist roster

In Asia, the prevalence of Western galleries at Asian art fairs shapes buying patterns. This exposure influences collector choices, as availability dictates purchase options. In the Asian art market, there is a general preference for vibrant, universally appealing, and age-friendly representational artwork.

These works often evoke a sense of “spring blossoming,” with positive symbolism. For many Asian collectors, it’s important for the painting and characters to “look appealing.” But from the artist’s perspective, this may be a taboo.

–As told to Cathy Fan. This article was originally published in The Asia Pivot on January 10, 2024.

Rebecca Wei is a founder of Lévy Gorvy Dayan & Wei. From 2012 to 2020, Ms. Wei served as President and Chairman of Christie’s Asia. Pre-Christie’s, Ms. Wei worked at McKinsey & Company, where she became the Firm’s first female partner in Greater China.