Fed's Mester Says Neutral Rate May Be Higher Than Thought Before; I Raised My Estimate Of It In March
Portfolio Pulse from Benzinga Newsdesk
Federal Reserve's Mester suggests that the neutral interest rate may be higher than previously estimated, and she raised her estimate in March.
May 20, 2024 | 6:12 pm
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NEGATIVE IMPACT
The statement by Fed's Mester about a potentially higher neutral rate could lead to market volatility, impacting SPY as it reflects the broader market.
A higher neutral rate implies tighter monetary policy, which can lead to increased market volatility and potential downward pressure on stock prices. SPY, representing the S&P 500, is likely to be affected as it reflects the broader market sentiment.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80