Possible scenario
Rate Scare Deepens
25% Chance
Markets could extend the selloff if investors conclude that the inflation shock forces the Federal Reserve into another hike. This would pressure long-duration equities, high-yield credit, housing-sensitive assets, and cyclical shares.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Up
- US dollar Up
Secondary impacts
- Technology -2.0%
- Consumer Cyclicals -1.8%
Portfolio impact
S&P 500-1.5%
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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