* World Bank sharply lowers growth outlook for world economy in 2023
* Powell says Fed may need to make unpopular decisions to stabilize prices
* West’s war on Russia’s oil revenues is starting to take toll on country’s finances
* US and allies preparing new sanctions on Russian oil industry
* Cryptocurrency exchange platform Coinbase is laying off 950 employees
* Narrower measures of core inflation are in focus for tomorrow’s CPI report
* First AI-powered robot lawyer to make debut in a US court
* Policy-sensitive 2-year US Treasury yield remains relatively steady at ~4.2%:

Is the inverted yield curve’s implied recession forecast accurate? “While we aren’t ignoring the signal completely we think the level of yield curve inversion is perhaps steeper/deeper than actual economic conditions may warrant,” advises Lawrence Gillum, a fixed income strategist at LPL Research. “We think the odds are roughly a coin toss that the U.S. economy falls into a recession in 2023 but it is no sure thing. The consumer is still spending and with businesses still hiring at an elevated clip, there is a chance that we can skirt by with an economic slowdown and not an outright contraction—although if the economy does contract, we think it will be a shallow contraction due to the aforementioned reasons.”

A soft landing for the US economy looks possible, writes economist Paul Krugman. Citing recent evidence that suggests inflation has peaked without lifting the unemployment rate, he advises that the case for a slower growth that avoids recession is plausible. “Even if we don’t need a severe recession to get inflation under control, we might get one anyway if the Fed brakes too hard,” he explains in his New York Times column. “There is, of course, the opposite risk: that the Fed will do too little and inflation won’t come under control. But I think the inflation news has been good enough to justify taking that risk by going easy on rate hikes at least for a while.” Krugman concludes: “A soft landing has become much more plausible than it seemed a few months ago. But it’s not at all a done deal.”