Branch² Intelligence
A slower AI payoff risks tipping the economy into recession, Apollo says
Key takeaway
Apollo warns that slower AI payoff, China threats, and falling token prices could tip the US economy into recession.
- Step 1Apollo warns slower AI payoff + China threats + falling token prices → recession risk perception rises.
- Step 2Risk-off sentiment drives US equity sell-off, especially AI-exposed tech; credit spreads widen; US 10Y yields decline on flight-to-safety but term premium rises on fiscal concerns.
- Step 3US term premium transmits to UK gilt yields via cointegration; UK SME borrowing costs rise; sterling weakens, increasing import costs.
Source: MarketWatch
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