Possible scenario
Fed Risk Reprices
20% Chance
Investors conclude that resilient equities and firm earnings give the Federal Reserve more room to keep policy restrictive. The bullish equity thesis is challenged by renewed rate sensitivity, especially after the recent Fed hike and 10-year yield breakout.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Up
- Market volatility Up
- Fed policy rate Up
Secondary impacts
- Technology -1.1%
- Consumer Cyclicals -0.7%
Portfolio impact
S&P 500-0.8%
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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