Banks and borrowers must now deal with tighter credit conditions, bringing a quicker end to rate hikes but also more economic risks.
We do not see signs of systemic risk, but further volatility is likely in the near term.
A tight labor market is keeping the Fed in a rate-hiking mode. All this job creation is re-calibrating expectations for the Fed and we think this is good news for fixed income investors.
Weak global growth for the year ahead appears almost certain. The outlook for capital markets is anything but.
Are bond investors right about US rate cuts, or will the Fed hold rates steady following the end of the hiking cycle? Watch the labor market.
As we enter the new year, attention is shifting from inflation to the economy and the effects of tighter Federal Reserve policy.
For all the gloomy talk about the economy in 2023, stabilizing interest rates could be a bright spot for investors. But with imbalances lurking in the shadows, 2023 could be the year for higher-quality bonds, select large- and small-cap stocks, and private-market investments.
Our long-term return expectations for capital markets serve as key inputs into our strategic asset allocation process for multi-asset portfolios and provide context for shorter-term forecasting.
Eyes remain firmly on the Federal Reserve, which has engineered a landscape of materially higher real and nominal rates.
Look under the hood of sizzling headline inflation, and you’ll see it starting to cool.