U.S. stocks may be in for rude awakening as rate cuts might not arrive until 2026
‘The main message in this paper is that to get inflation down to 2%, interest rates will have to stay higher for longer than markets currently are pricing,’ says Apollo’s Slok
Powell said last week that he doesn’t expect the rate of inflation to return to the Fed’s 2% target until 2025, implying that the Fed won’t cut rates until some time after that.
But Fed funds futures markets suggest traders are once again refusing to take the central banker at his word, and are instead penciling cuts to arrive in 2024.
Joseph Adinolfi MarketWatch 5 July 2023
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