As we reported yesterday, the new market regime where yields are now falling alongside stocks, suggests that consensus shifting away from stagflation and toward a pure recession (one where the Fed will have to cut rates/launch QE much sooner than expected), aligning with what was then the first out-of-consensus “2023 recession call” instigated by Deutsche Bank 5 weeks ago.
Curiously, despite the collapse in consumer confidence today, outside of DB there are still very few economists who agree though. However, as DB’s Jim Reid writes today, in recent weeks the awareness of the risks have shot up across the world and not just in financial markets. One way of showing this is Google searches for “recession” in the US. The index is benchmarked at 100 in March 2020, with volume of searches all relative to that.
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