The U.S. economy could be headed for a “no landing” scenario thanks to the hot labor market, but that might not be good news for the stock market, according to Bank of America analysts.
In an analyst note published Friday, Bank of America chief economist Michael Hartnett predicted a “no landing” scenario in the first half of the year, where there is no immediate slowdown in growth but inflation remains above trend. That would likely force the Fed to raise interest rates much higher than previously forecast — and keep them elevated for longer.
“No landing means no Fed pausing,” Hartnett wrote, warning that central bank tightening “always breaks something.” He projected the S&P 500 could tumble nearly 7% by early March as a result.
Read more here: https://www.foxbusiness.com/markets/bank-of-america-warns-no-landing-scenario-clobber-stocks-later-year
