The Fed is pausing interest rates – markets are pricing it in
Yahoo Finance, 5/12/23, “Fed’s real interest rate cycles in last 50 years ‘typically ended at over 2%’: strategist,” https://finance.yahoo.com/video/feds-real-interest-rate-cycles-133327966.html, mm
If this week's inflation data is any indication, the end of rate hikes might be within sight. The Consumer Price Index, a key inflation gauge, up 4.9% from a year ago. That's just a touch lower than March's 5% figure. And the Producer Price Index, that PPI, as you note in your hood, which the Fed prefers, rose 2.3% on an annual basis, below estimates and the slowest annual increase since January of 2021. Now, markets, they are pricing an 84.7% chance of a pause in June as of this morning. That's down slightly from the day prior. With one month to go until the Fed's next meeting, our next guest is keeping the bullish sentiment in the near term, raising its target on the S&P 500.