Possible scenario
Growth Scare Repricing
25% Chance
Markets focus less on the next hike and more on Rehn's message that sustained higher rates will slow the economy. The result is a lower expected terminal rate, weaker cyclical sentiment, and a modest risk-off move.
Initial impacts
- 10-year Treasury yield Down
- Riskier companies' borrowing costs Up
- Market volatility Up
- US dollar Up
Secondary impacts
- Finance -0.7%
- Industrials -0.6%
Portfolio impact
S&P 500-0.2%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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