The Federal Reserve’s aggressive monetary policy tightening to reduce inflationary pressure and continued supply chain constraints have increased the chances of the economy slipping into a recession. The recent sell-offs have lowered the valuations of many quality stocks significantly.
Many analysts expect the inflationary pressure to slightly ease in the near term, bringing some positive sentiment to the market. Therefore, investing in mid-cap stocks, which offer better returns than large-cap stocks and more stability than small-cap stocks, could be a wise decision. Moreover, increased focus on domestic production should benefit mid-cap companies in the upcoming months.
