Barclays with the great question of the cycle. The key point of resolution is US labour. If the 5m missing workers do not hold up wages growth as equities produce their own soft landing then it will follow through. If wages and inflation do hold up then higher for longer rates will kill the rally and cycle.
Rates and equities disagree, likely spelling troubles for equities
The string of recent positive economic data (retail sales, payroll data, etc.) and signs of waning disinflationary momentum has forced fixed income markets to significantly re-calibrate policy expectations. Indeed, growth is picking up in every major economy, raising pressure on central banks to go further. For instance, Fed fund futures markets are now pricing a peak rate of 5.3% by 2023 year-end, from below 5% less than a month ago. Similarly, short-term rates markets have eliminated plenty of policy rate easing over the next year
