Fed's Kashkari Says Base Case Is No More Rate Hikes, If Inflation Seems More Entrenched Than We Think, The First Thing Fed Would Do Is Hold For Longer, If Inflation Flares Again That Could Justify Rate Hike
Portfolio Pulse from Benzinga Newsdesk
Fed's Kashkari has indicated that the base case scenario involves no further rate hikes. However, if inflation appears more entrenched than anticipated, the Fed's initial response would be to maintain current rates for an extended period. A resurgence in inflation could potentially justify a rate hike.
March 06, 2024 | 9:26 pm
News sentiment analysis
Sort by:
Descending
NEUTRAL IMPACT
The SPDR S&P 500 ETF Trust (SPY) could see volatility as investors react to Fed's stance on interest rates and inflation.
The SPDR S&P 500 ETF Trust (SPY) is highly sensitive to changes in Fed policy, especially regarding interest rates and inflation. Kashkari's comments suggest a cautious approach to rate hikes, which could lead to market volatility as investors digest the implications for economic growth and inflation. However, the uncertainty about the direction of future rate adjustments makes the short-term impact on SPY neutral, albeit with increased volatility.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 75