As we approach the heart of summer, economic and geopolitical waves seem to be breaking almost nonstop, creating confusing crosscurrents for investors struggling to get their bearings on inflation, growth and market prospects. For its part, the U.S. Federal Reserve last week decided—reasonably enough—to take stock, holding the fed funds rate at 5.25% after hiking from near zero in a record- breaking 15 months. Yet the churn of news continues. In the U.S., economic tea leaves are scrutinized in an effort to reconcile resilient stock and labor markets, disparate pricing data for various goods and services, and the future path of monetary policy. Across the pond, the Eurozone appears to have entered at least a mild recession amid stubborn inflation and wobbly business confidence, all complicated by the protracted war in Ukraine. Further east, Beijing has finally restarted China’s economic engine after sunsetting the world’s most restrictive Covid policy, yet both domestic and export-related data suggest the recovery there remains underwhelming at best.
Quarterly Market Outlook
The Clear Harbor Market Outlook is a quarterly market update.