DNY59/iStock via Getty Images As we enter 2023, our macro outlook for fixed income markets revolves around three main drivers: Elevated inflation Restrictive monetary policy Rapidly slowing growth In 2022, historically high inflation led global central banks to make a series of bold tightening moves. In 2023, we believe this may result in a significant slowing of global growth and, in the U.S., a likely recession by the middle of 2023. U.S. outlook In the U.S., it’s our view that inflation may gradually move toward the Federal Reserve’s (Fed) 2% goal over the year. Core goods inflation has already made enormous progress over the course of 2022, driven by a softening in used auto, apparel, and furnishings prices. Services have been stickier, due in large part to the long lags in shelter/owners’ equivalent rent. Further, timely measures of new lease signings suggest that it’s only a matter of time before rent/services inflation makes substantial progress towards the Fed’s goal. In the meantime, the Fed continues to hike into a slowing economy, based on inflation metrics that lag the policy rate by as much as 18 months. Already, recession warnings are seen in many leading indicators, including: • The yield […]
K&X Design and Investment Technology, LLC
Invest The Invisible Impact
K&X Design and Investment Technology, LLC
Invest The Invisible Impact
