JAMIE MCGEEVER: Fragile US bond market hopes pinned on slim chance of dodging recession
While a cycle-busting scenario seems far-fetched to many, if the benign soft landing forecasts fail to play out, the Fed may be forced to start buying again
08 May 2024 - 05:00
Any hope of sustaining US fiscal accounts at such stretched levels and keeping the fragile bond market equilibrium intact may have to hinge on avoiding any recession at all — a cycle-busting scenario that seems far-fetched to many.
What’s more, if the benign “soft landing” or “no landing” economic forecasts on which the already scary US budget math is predicated fail to play out, the Federal Reserve may ultimately be forced to start buying bonds again...
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