Despite the current banking crisis, the Federal Reserve went ahead with a 25-basis-point interest rate hike, bringing the federal funds rate to a new range of 4.75% to 5%, the highest since October 2007. With the federal funds rate likely to climb higher and the banks likely to tighten lending, there is a significant risk of a recession this year.
Amid the uncertainty, investing in pharmaceutical major Johnson & Johnson (JNJ) could be wise. Pharmaceutical stocks are some of the most stable investment options during a recession, as the demand for drugs and therapies is largely inelastic. This helps them maintain their profit margins irrespective of the economic cycles.
