The Market: Soft Landing Trees in a Burning Forest

Discussion

Just step back, zoom out, and think about what’s going on right now:

• The developed market manufacturing sector is in recession, and arguably getting worse

• Eurozone manufacturing and services PMI data surprised to the downside this morning (and we’ll see at 9:45am EST what S&P Global reports for US data)

• The Fed and ECB are still raising raising rates and at best will maybe pause after hiking this week

• The 3y/10y UST curve is already deeply inverted, has been deeply inverted for months now, and is again re-inverting after its early-July steepening on softer than expected inflation data

Meanwhile…