Recession Risk Looms Large as Bond Markets Price in Steeper Rate Hikes Globally
- Resilient economies, stubborn inflation reshaped the outlook
- Some central banks in pause mode, gauging lagged effects
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Forget about interest-rate cuts. The bond market is now pricing in a steeper path for monetary tightening by central banks around the world, raising the danger of recessions as policymakers struggle to bring inflation under control.
Just weeks ago, traders were expecting almost every developed-market central bank to cut benchmark rates within a year, the swaps market showed.