Concerns about stagflation, a situation believed to be more severe than a recession, are becoming more prominent. The majority of fund managers anticipate stagflation in the global economy in the coming year. These concerns intensified as the Federal Reserve adjusted its inflation and growth forecasts for 2025. Stagflation is a challenging economic scenario where high inflation coincides with low growth, making it difficult for policymakers to respond effectively. The fear of stagflation has heightened among investors, reminiscent of the 1970s economic downturn marked by sluggish growth and high unemployment. A recent survey by Bank of America revealed that 71% of fund managers anticipate stagflation in the global economy within the next year, leading to a notable decrease in their holdings of US stocks. Following the Fed's meeting, where the inflation forecast was lifted and the growth forecast lowered for 2025, concerns about stagflation increased. Various economic analysts, including UBS Global Wealth Management and Stifel, also voiced their unease, citing factors such as trade policies that could impact economic growth and lead to a potential "mini-stagflation" period in the latter half of 2025, potentially triggering a market downturn.