The Federal Reserve is now watching the markets closely, and the continuity of withdrawing liquidity for a long period will accelerate avoiding deflation. It is easy to pump liquidity, but it will make it difficult to reach healthy inflation during the current fiscal year.
I am afraid of what is happening in China. The last thing we are waiting to see now is the return of COVID19 with a good mutation, which means more health restrictions.
And the war that is taking place in Ukraine and the lack of control over it.
The energy crisis and its problems, especially with the European economy.
So we have enough problems to fear deflation
The problem is that almost no one is optimistic about the economic development in 2023. Many people are looking at austerity. Such sentiment will affect many people. The collective consciousness is very bleak. The unemployment rate is too high. Is COVID19 really over? I dont think so.