US recession inevitable, says Deutsche Bank and Treasury curve.

Deutsche Bank predicts a 100% probability of a US recession due to expansive fiscal and monetary policy, and aggressive rate hikes needed to tame inflation. The bank expects at least one more 25-basis-point increase to the fed funds rate in July, with a moderate recession beginning in the final three months of the year and continuing through the first three months of 2024. However, AI could be a new source of growth in the long term. The expected drop in inflation and recession will prompt the Fed to start cutting rates in March 2024.