Zephyr Quarterly Update: First Quarter 2024

Cheryl Munoz |

2023 is in the books and the last quarter left investors looking forward to a bright and happy new year. The economic data in 2023 was better than expected: inflation fell, employment remained resilient, and we didn’t end up in recession – in fact, growth was impressively resilient. 

It now looks like the elusive economic soft landing may actually have a shot of becoming a reality (at least, for a time). Does that mean we can celebrate? Not quite. There is a big difference between achieving a soft landing and maintaining one. The reason is straightforward: When an economy reaches full employment, the central bank needs to calibrate monetary policy almost perfectly to keep it there. If it does not cut rates fast enough, unemployment will increase; if it cuts rates too fast, inflation will rise. 

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