The subject of discussion is shifting from a sturdy economy to issues about financial weakness in bond markets. This shift is properly-founded, as stories about the damaging effects of the Federal Reserve’s price hikes are becoming extra prevalent. The outcome of the Fed’s forecast will figure out no matter whether a soft landing is feasible or if the brakes will continue to be applied to the economy.
As interest prices have risen, we are beginning to hear extra accounts of folks suffering from the consequences. This raises two vital queries: how significantly suffering have to these folks endure in order to obtain the broader financial impacts preferred by the Federal Reserve, and no matter whether this suffering is so extreme as to potentially trigger a recession. The Fed’s forecast, which will be revealed tomorrow, holds the possible to offer clarity and shape the final outcome.