Fed Meeting Preview: Is A March Rate Cut Likely?
Portfolio Pulse from Piero Cingari
The Federal Reserve Open Market Committee (FOMC) is expected to maintain interest rates unchanged at their upcoming meeting. Markets are speculating on a potential rate cut as soon as March, with a 50% chance according to the CME Group FedWatch tool. The S&P 500 Index, tracked by SPDR S&P 500 ETF Trust (SPY), is at record highs in anticipation. Economists and financial institutions like ING Group and JPMorgan Chase predict no immediate rate cut but foresee cuts later in the year. Bank of America expects a rate cut in March, while RSM and a former Dallas Fed advisor suggest cuts could be justified soon due to easing inflation and solid growth.
January 29, 2024 | 6:57 pm
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SPDR S&P 500 ETF Trust (SPY) is trading at record highs amid speculation of potential rate cuts by the Federal Reserve. The ETF, which tracks the S&P 500 Index, may be influenced by the Fed's decision and subsequent press conference.
While the SPY is currently at record highs due to speculation, the actual impact of the FOMC meeting will depend on the Fed's statements and actions. If the Fed signals rate cuts sooner than expected, SPY could rise further. However, if the Fed suggests a delay in rate cuts or maintains a neutral stance, SPY could see a short-term pullback due to tempered expectations.
CONFIDENCE 70
IMPORTANCE 75
RELEVANCE 80