Fed's Logan Says Neutral Rate Is Probably Higher Now Than It Was Before Pandemic; My Guess Is We Don't Go Back To The Low Rates Before The Pandemic
Portfolio Pulse from Benzinga Newsdesk
Federal Reserve's Logan suggests that the neutral interest rate is likely higher now compared to pre-pandemic levels and anticipates that rates will not return to their previous lows.
June 18, 2024 | 5:31 pm
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NEGATIVE IMPACT
The statement from Fed's Logan about higher neutral rates suggests that interest rates will remain elevated, which could impact the stock market negatively in the short term.
Higher neutral rates imply that the Federal Reserve may keep interest rates elevated for a longer period, which can lead to higher borrowing costs and potentially lower stock market valuations. SPY, being an ETF that tracks the S&P 500, could see a short-term negative impact as a result.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80