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Recession fears still abound, but have certainly eased over the last month as GDP growth has not slowed as much as Wall Street expected. Additionally, the Federal Reserve has now trimmed rates 3 times in a row and restarted a form of “QE-Lite”. This has led to the steepening of a previously inverted yield curve, and we believe a re-ignition of inflation is back on deck. While the strong Dollar continues to play a role in dampening manufacturing and corporate earnings, US real rates and the greenback’s base effect are likely to diminish in 2020. Therefore, any moderate weakening of the greenback could actually boost profits and exports in the year to come!

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