Via a JP Morgan note on the US:
JPM's main points:
- We expect the FOMC to tighten another 100bp: 50bp in December and 25 by in both February and March
- The almost 500bp of expected cumulative hikes is already delivering a commensurate tightening of financial conditions ... which we believe will tip the economy into mild recession later next year
- Even with a modest slowdown and with firms hoarding labor, we think the economy could shed over a million jobs
- Inflation should moderate with a softer labor market, stronger dollar, and unwinding of pandemic distortions
- With falling inflation and an unemployment rate rising toward 5%, we look for the Fed to ease up on policy by early 2024
- Calibrating monetary policy to maintain a soft landing will prove to be a very difficult task, but we don't see the need for a big recession to bring the economy more into balance
---
Yeah, this is a bad moon rising.
As for only seeing a 'mild' recession and 'no need' for a big one ... sheesh ... as if the Fed has this level of control!
This is not a photo, OK?
