An aging population, increasing prevalence of chronic diseases, and rising investments in R&D should drive the healthcare sector’s growth. Moreover, the passage of the Inflation Reduction Act, which lowers healthcare costs for Americans, is expected to be favorable for the industry. The global consumer healthcare market is expected to grow at a 21.7% CAGR to $932.74 billion by 2026.
Moreover, amid the economy's uncertainties, the inelastic demand for healthcare should help the sector stay resilient. Investors’ interest in this space is evident from the SPDR S&P Health Care Services ETF’s (XHS) 1.7% gains over the past month versus the SPDR S&P 500 Trust ETF’s (SPY) 2% loss.
