Possible scenario
Credit Stress Spreads
20% Chance
The savings decline may confirm that households have less capacity to manage revolving balances after years of elevated rates. Banks and nonbank lenders respond by tightening credit, reducing consumer purchasing power and pressuring lower-income borrowers.
Initial impacts
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
- Market volatility Up
- US dollar Up
Secondary impacts
- Finance -1.3%
- Consumer Cyclicals -0.9%
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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