JEPI - A Road Map To The Coming U.S. Economic Cycle

• The coronavirus is likely to accelerate throughout the holidays, with activity restrictions likely to tamp down growth - even without another round of broad national lockdowns. At the very least, slow growth and low inflation are likely for the next several months.
• The Fed will keep monetary policy easy for the foreseeable future. We see a greater than 50% likelihood that it will ease further near term, most likely by recalibrating its quantitative easing purchases to hold down longer-term interest rates.
• As long as the US is in the expected low-growth, low-inflation regime, the Fed will keep rates very low, limiting the potential rise in market-driven rates. This isn't to say that 10-year Treasuries will always yield below 1%, but a return to something on the order of 2.5% or 3.0% isn't likely for the foreseeable future.

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