The recent re-inversion of the Treasury yield curve and the sharp sell-off in equities, due to growing fears that the new coronavirus will develop into a full-blown pandemic, have reignited fears that the US economy is about to be plunged into a recession. Our composite model still puts the risk of a recession over the next 12 months at a modest 10%, however, as the impact from the inversion of the yield curve has been offset by positive news on manufacturing and housing activity.
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