Don’t Short The U.S. Economy – November 20, 2023

A just-published report updated our view on the U.S. economy, and highlighted key indicators which show that the economy continues to expand at a solid pace, supporting our view that a U.S. recession remains unlikely for the foreseeable future. Moreover, while inflation has continued to moderate, its underlying rate remains well above 3%.

U.S. consumers remain in solid shape, and consumption should continue to expand at an above-trend pace in the coming year. While some sentiment measures from surveys show pessimism about the future, actual (hard) activity data generally do not. The underlying trends in income and corporate profits remain solid, and job security is historically elevated.

We expect U.S. growth to remain resilient and for inflation to bottom out above the Fed’s target next year, which implies that policy rate cuts will not be warranted. The recent decline in Treasury yields should prove temporary, similar to other such countertrend moves in the past 18 months.


  • All Research Highlights