Misery – defined as the unemployment rate plus inflation – is falling sharply in the US and more slowly in Europe. Kit Juckes, Chief Global FX Strategist at Société Générale, analyzes the implications for financial markets.
Can beating inflation be painless?
Risky assets would clearly benefit from a recession-free escape from inflation. The Dollar wouldn’t. Nor would the Dollar benefit from a mild recession that allowed European misery to melt away without too much pain (and the ECB to go on hiking after the Fed was finished).
But the tail risk that the Fed is encouraged to pause then pivot and stop raising rates, only to see tight labour markets drive a fresh upturn in underlying inflation next year, is now a real risk. That outcome, scuppering European recoveries and forcing the Fed to drive the economy in a late 2024 recession, may be a tail risk but it’s a big enough one to underpin FX volatility going forwards.
We think the volatility downtrend is over and bumpier markets are likely.
風險提示：本文所述僅代表作者個人觀點，不代表 Followme 的官方立場。Followme 不對內容的準確性、完整性或可靠性作出任何保證，對於基於該內容所採取的任何行為，不承擔任何責任，除非另有書面明確說明。
暫無留言。 來發表第一則觀點吧。