Deutsche Bank think a US recession is more likely than the hoped-for "soft landing", citing the risk the Federal Open Market Committee (FOMC) tightening interest rates too much.
- "Given that inflation peaked significantly above target, the Fed should err on the side of tightening too much, rather than too little,"
- a "soft landing" can still be achieved but its still likely that the Fed needs to "depress demand below potential" to bring inflation to target
DB say they expect the data to show the US economy under greater pressure early in 2024.
In contrast to Deutsche Bank, this from GS earlier:
