Possible scenario
Inflation Validates Fed
20% Chance
In this scenario, investors infer that the breadth of Fed support for hikes reflects genuine concern about persistent inflation. The path of least resistance becomes higher yields, a firmer dollar, and pressure on long-duration equities.
Initial impacts
- 10-year Treasury yield Up
- Riskier companies' borrowing costs Up
- Market volatility Up
- US dollar Up
Secondary impacts
- Technology -1.2%
- Utilities -1.2%
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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