Fed Projections Show Higher Longer-term Policy Rate Projection At 2.6% Vs 2.5% In December; Says Inflation Has Cooled Over Past Year But Remains 'Elevated'
Portfolio Pulse from Benzinga Newsdesk
The Federal Reserve has updated its projections, indicating a higher longer-term policy rate of 2.6%, up from 2.5% in December. The Fed acknowledges that inflation has cooled over the past year but remains 'elevated'.
March 20, 2024 | 6:03 pm
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NEUTRAL IMPACT
The SPDR S&P 500 ETF Trust (SPY) may experience volatility following the Fed's updated projections on policy rates and inflation.
The SPDR S&P 500 ETF Trust (SPY) is sensitive to changes in Federal Reserve policy and inflation expectations. The updated projections could lead to market volatility as investors adjust to the new policy rate outlook and ongoing concerns about inflation. However, the impact is considered neutral in the short term as the market digests the implications of the Fed's stance on inflation and policy rates.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 75