Economy Cools but Avoids Recession So Far as Inflation Eases, Growth Normalizes
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Inflation has cooled significantly over the past year but remains above the Fed's 2% target. Rate hikes are likely done but rates will stay high for a while.
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Economic growth has persisted without recession, suggesting a "Goldilocks" soft landing scenario. But growth is normalizing as tailwinds fade.
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Consumers remain financially healthy, spending has held up well, and job market remains strong. But risks of recession are still elevated.
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Markets face headwinds from tight policy and recession worries. But stocks discount future developments and outlook long-term remains positive.
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Key data to watch inflation expectations, consumer spending, job market strength, manufacturing activity.