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Economic Update    Market volatility has intensified as investors weigh the probabilities of a hard or soft economic landing.The strong labor market has helped sustain economic growth,and inflation remains significantly higher than the Federal Reserve’s target. Financial conditions have eased,and credit spreads have narrowed.Geopolitical risks remain as the Russia/Ukraine war persists and China reopens,while domestically the debt ceiling risk has emerged.Market sentiment has shifted with the resilient economic data thus far in 2023 and has converged with the Fed’s outlook for higher rates for a longer period.We believe the Fed will continue to raise rates and maintain a higher terminal rate for an extended period until inflation reaches the Fed’s target range. As expected at the February 1st meeting,the Federal Open Market Committee (FOMC)raised the fed funds target rate by 25 basis points to a range of 4.50 -4.75%,in a continuing downshift from previous hikes.The decision was unanimous and the statement reflects inflation is easing “somewhat.”The sentiment was hawkish, indicating that the extent of “ongoing increases”in the fed funds rate will be data dependent.We believe the FOMC will continue to implement tighter monetary policy at a slower pace and hold rates at restrictive levels for some time until inflationary pressures subside and remain in the Fed’s target range. In February,the yield curve inversion widened.The 2-year Treasury yield surged 62 basis points to 4.82%,the 5-year Treasury yield increased 57 basis points to 4.18%,and the 10-year Treasury yield rose 41 basis points to 3.92%.The inversion between the 2-year Treasury yield and 10-year Treasury yield increased to -90 basis points at February month-end versus - 69 basis points at January month-end.The spread was a positive 39 basis points one year ago.The inversion between 3- month and 10-year treasuries narrowed to -89 basis points in February from -115 basis points in January.The shape of the yield curve indicates that the probability of recession is increasing. 3