The Fed broke the string of 75 basis point rate hikes with its recent 50 bps hike in response to the cooling inflation numbers that provided some relief among investors. However, it was short-lived as U.S. stocks suffered their longest weekly losing streak with the Federal Reserve’s renewed vow to keep interest rates as high as 5.1% in the next year.
The economists at Bank of America continue to expect a mild recession in the first quarter of next year with negative GDP for 2023. Moreover, a Reuters poll of economists showed that U.S. economic growth could slow to 0.3% in 2023. The poll also suggests a 60% chance of a U.S. recession next year.
