The result has been lower equity prices, wider risk spreads on corporate bonds and many other debt instruments, and greater pressures on financial institutions. At the same time, heightened demand for safe assets has put downward pressure on Treasury yields and boosted the foreign exchange value of the dollar.
These developments partly reflect the response by investors to news about the U.S. outlook that has, on net, fallen short of their expectations, as well as a recognition that growth is slowing elsewhere in the global economy.