Well, markets are pricing in a terminal rate roughly around 5.40% now so it will be a big shift if we start to see expectations shift towards 6.00% instead. For some context, BofA is still expecting the Fed to raise rates three more times this year (by 25 bps) so as to push the terminal rate to the 5.25% to 5.50% range.
However, they say that "the resilience of demand-driven inflation means the Fed might have to raise rates closer to 6% to get inflation back to target". Adding that "gangbusters January activity and spending data" points towards a higher pain threshold on the part of consumers when it comes to the Fed's tightening cycle.
In that lieu, the firm says that they do see a recession being more likely than a soft landing with their base case being one to come in Q3 this year. That is the scenario BofA is expecting considering that the housing and manufacturing sectors are already in recession and a slowdown in consumer demand would tip the scales.