13 October 2023
Elevated risks loom over the U.S. economy as the Federal Reserve navigates a highly leveraged financial environment amidst its “higher for longer” strategy. Historically rooted patterns suggest the intersection of surging debt and restrictive financial conditions may steer towards a crisis, particularly given prior instances where rate hikes and yield curve inversions precede recessions. The heightened policy misstep risk amidst slowing economic growth and rising borrowing costs signals caution for potential crisis onset in the near future.