One year since the inception of our Stagflation Shock scenario, the global economy continues to face elevated inflation and falling growth. Both are slowing, but they are slowing—slowly. And the descent has not been smooth.

As the U.S. Federal Reserve wrestles inflation lower, investors wonder increasingly if its traditional target still makes sense. Should policymakers really insist on driving inflation all the way down to 2%? Haven’t pandemic and war fundamentally altered global dynamics that drove rates ever lower? Isn't this time … different?

The world is grappling with a combination of once in a generation shocks, producing an uncertain and complex economic landscape.

With a fresh surge of inflation increasingly unlikely, the market outlook is far better than it was a year ago.

For better or worse, the path of this year’s U.S. Consumer Price Index will determine the level of markets.

In the flood of market data, you could do worse than keeping your eye on these as you assess the odds of a ‘softish landing’.

If you thought this year was difficult, just wait. The good news is that the extreme outcomes investors worried about through most of 2022 look less likely for 2023.

This year’s choices were hardly simple, but economic policymakers in China, Europe and the United States face much trickier decisions in 2023.

Jerome Powell surely has a holiday wish list, especially facing a new year of slower growth, rising prices and inverted yield curves.