This year has been arduous for the stock market due to record-high inflation, Fed’s aggressive interest rate hikes, and geopolitical tensions, triggering fears of a potential recession next year. However, the recent inflow of positive macroeconomic data suggests that a ‘soft landing’ of the economy might be possible.
Inflation cooled more than expected in October and November, while the labor market showed resilience. In addition, the Fed lowered the size of interest rate increases from 75 basis points down to 50 basis points in December.
