Good morning.
The Fed’s modest rate increase yesterday has sparked hopes that the U.S. can get inflation back to 2% without a serious recession. Count me as skeptical. Wage inflation is still running close to 5%, and there’s not a lot of historical evidence to suggest you can beat that back without an economic slowdown.
But what’s interesting to me is that while businesses are clearly bracing for recession—a PwC survey I reported on recently found 73% of CEOs expecting a decline—they seem even more focused on the need for long-term transformation of their businesses, driven either by new technology or by the demands of the energy transition or by a retooling of their supply chains.
