Interest rate hikes paused in June, but will they resume later this year?
- Vanguard believes that the Fed has more work to do to bring inflation to acceptable levels and keep it there. With each month of labor market resilience, we see increasing risks that wage growth could become stuck at current levels. – Vanguard
- The investment environment remains cloudy. While aggressive rate hikes may finally be behind us, we don’t expect rate cuts before the end of 2023, meaning investors must still contend with the “higher-for-longer” rate environment. And recession odds have increased, although we don’t anticipate a long or deep contraction. – Nuveen
- I’ll say a few words about Powell’s testimony in front of Congress. There were no new economic or inflation reports between the Fed decision and press conference and last week’s commentary, so there was nothing that notable in his testimony. Powell repeated that the Federal Open Market Committee (FOMC) believes two more hikes could be appropriate and he is on board with that view. Of course, his views and others are subject to change with new data that comes in. – Jeremy J. Siegel, Sr. Economist to Wisdom Tree
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