JP Morgan's Kolanovic on the US June CPI result in a note Monday:
- has slightly increased the Federal Reserve’s chances of a “soft landing”
- “While we still see the Fed hiking at the July meeting, the downside CPI surprise means a narrow path to a soft landing is modestly wider”
remains skeptical “that a soft landing can be achieved in which inflation returns to central bank comfort zones on a sustained basis without a downturn.”
- warned that European stocks face risks in H2 from more European Central Bank tightening
- US small- and mid-cap equities may offer “quite a bit of upside” if inflation falls to 2.5% and interest rates start to come down
