The Range of Potential Outcomes for the U.S. Economy Remains Wide

 

What is this chart showing?

This chart shows three potential outcomes for the U.S. economy in 2023, and what each could potentially mean for various segments of both the economy and markets.

Probabilities for the likelihood of each outcome from our network ofasset manager partners are based on survey results from late June.

Why is it important?

The term “landing”is frequently used when discussing whether an economy will enter a recession at the conclusion of rate hiking cycles. By raising rates, central banks seek to slow the economy to bring price stability while avoiding a recession.

After beginning the year cautiously optimistic about the prospects of a soft landing, market sentiment shifted quite a bit throughout the first half of 2023, pricing in both a no landing and hard landing outcome atvarious times.

While it remains to be seen what’s next for the U.S. economy, strength in both the labor market and consumer indicate that a soft landing still may be possible,even if the path has narrowed.

The probabilities expressed above are those of select asset managers surveyed as of6/30/23 and not necessarily that of any Lincoln Financial Group affiliate. Results are not based on any particularized financial situation, or need, and are not intended to be, and should not be construed as, a forecast, research, investment advice or a recommendation for any specific strategy, product or service from any of the participating investment managers.

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