Over the past month, there has been a major change in the market under the surface. In essence, inflation risk is dropping, while recession risk is increasing.
This has major implications for investors, especially as this looks to be a meaningful trend that could persist for many months. Although we’ve yet to see a major impact in terms of earnings and employment, it’s increasingly clear that the economy is slowing which is being exacerbated by the Fed’s hawkish stance.
