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Nordea Markets analyst suggest that the markets require a trigger for the expected US slowdown to become a recession, be it a housing market crash like for the 2008-09 recession, an equity market fall-out like for the 2001 recession, or from the Fed tightening too much like for those in 1980 and 1990.

Key Quotes

“Further rate hikes are needed for Fed to be the trigger this time around. An alternative trigger would be if Fed makes overly optimistic choices regarding balance sheet policies, with a continuation of a slower & passive version of quantitative tightening (QT).”