The new year got off to a roaring start on rising hopes for a soft landing for developed economies as inflationary pressures showed continued signs of abating, while China’s reopening also fueled investor optimism at the beginning of the year. While central banks have downshifted the pace of tightening in response to moderating inflation, the focus now turns to the implications of cumulative rate hikes on both the economy and corporate earnings. Here, early signs are pointing towards some fundamental deterioration, which remains at odds with the latest revival in risky assets.