Possible scenario
Stagflation Risk Rises
18% Chance
The market starts treating the PPI spike as both inflationary and growth-negative because diesel and tariff costs hurt real demand. Risk assets fall, credit spreads widen, and investors rotate toward defensive sectors and cash-like assets.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- US dollar Up
Secondary impacts
- Industrials -0.8%
- Consumer Cyclicals -0.6%
Portfolio impact
S&P 500-0.4%
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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