Even though it has slowed the pace of rate hikes, the Fed remains dependent on incoming data and has acknowledged that interest rates may need to go higher and stay higher for a prolonged period, which is a headwind for the economy. The aftereffects of the banking crisis also could be problematic as risk-conscious banks tighten lending standards to preserve liquidity. This article reveals how broader equity markets do not fully reflect the prospects for a more significant downturn in economic growth and earnings in the back half of 2023.

Access the article and learn about:

• How banks and capital markets have fared since the SVB collapse
• Why the Fed’s balance sheet expansion is expected to be temporary
• The Fed’s effort to combat inflation amid uncertain risks in banking
• Why investors should remain cautious and underweight to equities