This one’s a ‘slow burner’ that keeps rumbling along. Difficult to know which way it is going:
Current US Treasury market liquidity is comparable with the 2007-09 global financial crisis and the March 2020 crisis, particularly for the two-year note, according to a quantitative assessment of interdealer trading by New York Federal Reserve economists.
Powell keeps making noises about the ‘tools’ that The Fed. has in place to avoid a recession but at the moment he is on a tightrope with inflation on side and recession the other.