Fed officials have begun to temper expectations for rate cuts, with some saying there is no reason to adjust rates at this point. As the market expected three rate cuts in the second half of the year, Verdence Capital Advisors Chief Investment Officer Megan Hornman joins Morning Brief to discuss why the markets (^DJI, ^IXIC, ^GSPC) We discussed whether market (^DJI, ^IXIC, ^GSPC) expectations need to be readjusted.
Horneman said the market appears to be adopting a “more realistic” stance on what the Fed can accomplish in 2024. He called a rate cut in March or June “too optimistic” and said he always believed any rate cut would happen. About the second half of this year. What is “new interest rate forecast”?[s]” Horneman says the market is now starting to “reset” to align with these revised expectations.
Mr. Hornman expressed particular concern about the labor market and the potential impact of inflation, stressing that sustained wage growth remains “a problem for the Fed.”
Hornman attributes some of the economic resilience to “[Fed Chair] “President Jerome Powell took such a dovish stance late last year,” she believes, which helped spur a rebound in economic activity, which could lead to a resurgence of inflation, adding that “if they “This could be a very dangerous line to walk,” he warned.
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Editor's note: This article was written by angel smith
