Rising inflation, rate hikes, supply-chain problems and the Russia-Ukraine war have contributed to growing recession fears. While recessions are impossible to predict, we think the risk of one—sooner rather than later—has picked up.
Another burst of market volatility has confirmed that the peak in negative economic consequences—courtesy of tighter policy and slowing growth—is likely still ahead of us.
With inflation running at a 40-year high, and the Fed having embarked on a rate hike cycle, the burning debate is whether the slowdown ends in a soft landing or a recession.