Surveying the 2023 economic landscape for financial institutions

Without a doubt, the economic story of the past year has been the highest inflation in decades. Not only is it impacting current financial and economic activity, but it is dominating the outlook as well. In short, whatever happens with inflation will determine the trajectory of the economy over the next year and a half.

If inflation begins to come down significantly, it will take pressure off the Federal Reserve to keep raising rates aggressively. If instead, it stays persistently high (as it has for the past six months), the Fed will have to keep its foot on the brake pedal of the economy for longer.

How will these economic forces impact your financial institution in the coming year?

Economic Outlook for Financial Institutions

Rising delinquencies, tighter margins driven by an inverted yield curve, and softening loan demand due to higher rates will challenge financial operators.


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