Difficult times for corporate profits

Higher interest rates and sharply rising oil prices have been instrumental in leading to a slowdown in world economic activity. In addition, the sell-off in technology stocks indicates a cooling in IT spend from the heady rates of recent years, further dampening economic growth. There is a risk that this confluence of events could prove recessionary. However, we remain of the view that this can be avoided, that we are still in the "mini-cycle" environment of low amplitude volatility in growth and inflation. While this assessment of the macro environment is relatively benign, the combinat...