1. Late Expansion (The Peak Before Trouble) What happens
Inflation stays high Interest rates rise Consumers start spending less Companies’ profits slow Debt pressure increases Yield curve may invert
2. Slowdown / Early Contraction What happens
PMI declines Hiring slows Manufacturing weakens Consumer confidence falls Credit conditions tighten 3. Recession What happens
GDP shrinks Unemployment rises Businesses cut spending Consumers reduce spending heavily Bank stress may appear 4. Bottoming Phase What happens
Central banks cut rates Stimulus begins Liquidity slowly returns Inflation cools
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