Amid Trump's tariffs and softer US economic data at the balance, we're seeing an uptick in interest on recession risks. And it's also feeding into the commentary from market analysts.
Meanwhile, MUFG's title for their note today also highlights this: "Asian Currencies Mixed; US Recession Fears Weigh".
As things stand, the echo we're seeing and hearing is one of fear and that will make it challenging for risk trades to run against that backdrop.
We're now pricing in ~84 bps of rate cuts for the year by the Fed with odds of a May rate cut seen at ~59%. Is that a bit much considering the pivot away from just one rate cut priced in during the end of January? Is the Fed really going to be this dovish considering the recent data?
Those are fairly interesting questions and we'll have to wait on the US CPI report this week and the FOMC meeting next week to have a better idea of where this is all going.
This article was written by Justin Low at www.forexlive.com. Read More Details
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