The global growth outlook continues to deteriorate, and concern about global recession mount with rising pressure in the global economy. In the US, stubbornly high inflation has kept the Federal Reserve on the defensive. The market now expects the Fed to raise the federal funds rate by at least another 200 basis points, inclusive of the 75 bps expected this week.

US growth forecasts continue to lose steam after the economy registered two quarters of economic reversals. Higher US rates imply higher rates elsewhere. Arguably, the US economy could use higher rates, but most other economies are not strong enough to digest tighter monetary policy. However, the stronger US dollar will push these hikes out to the rest of the world...

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