Fed's Powell says rate cuts are likely. Bets are still on for 3 rate cuts. Great news for Americans with credit card debt at records
US markets digested Fed commentary with Fed Chair Powell saying the Fed will take its time to assess the economy which is strong, with strong employment. But he said the Fed
will likely cut rates this year
While the Fed's Kashkari sees two rate cuts in 2024, potentially just one.
As for what the Fed rate cut bets are now.
Bets are on for a a greater chance of a cut in September (with a 79% chance of a cut). Ahead of that, there is potentially a cut in June (with a 66% chance of a cut). And a 75% chance of a cut in December, just in time for Christmas. This will be welcome for many given credit card debt is at a record all time high (to the benefit of Vis and Mastercard and their shareholders).
Again, what key is next week's February CPI and PPI for Feb. We'll need to see evidence that January's inflation data was a blip. Or worse, it might show a reversal of the trend. And that inflation is heading back up.
Coming into this week; momentum has been strong. US stocks have been rallying for 16 out of 18 weeks, that first time we've seen this since 1964.
Overall optimism is high, and the breadth of the rally is strong. The Nasdaq and S&P500 are still in record highs. And bullish signals are here with 76% of the S&P500 stocks trading above their 200 days moving average. And fear guage, the volatility index is behaving, at a reading of 14, which is one-year lows.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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