The base case assumption, which assumes a mild US recession in the middle of next year, looks for 10-year Treasury yields to fall to 3.7% by the middle of next year. 

USD/JPY could be just below 150 in mid-2024 on a US no landing, below 130 on a hard landing and just below 140 on our base case.  

Our rates forecasts imply EUR/USD reaching 1.15 by mid-2024 on our base case for the economic outlook (mild recession), and 1.02 on the ‘no-recession’ forecast. A hard landing clouds the outlook because the initial reaction is for the relationship between EUR/USD and interest rates to break down, temporarily.