Rates volatility to continue as economic outlook evolves

Although the U.S. economy
is withstanding the Federal
Reserve’s rate interest hikes
and the recent banking system turmoil
remarkably well as of late April, the
rates market appears to be pricing in a
“recessionary cliff” later this year. In this
scenario, the economy would suddenly
fall into a deep recession, with the Fed
responding by cutting rates before the
end of 2023. By T.Rowe Price as at May 2023.