Possible scenario
Risk-Off Reversal
20% Chance
The Treasury move begins to tighten financial conditions quickly enough that investors shift from inflation and supply worries to growth and credit risk. In this path, long yields fall from the highs, but the move is negative for equities and lower-quality credit.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Market volatility Up
- Bitcoin Down
- US dollar Up
Secondary impacts
- Finance -4.2%
- Consumer Cyclicals
Portfolio impact
S&P 500-2.5%
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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