After months of waiting and trepidation, the Federal Reserve officially raised the Federal Policy rate for the first time since December 2018. While the media focuses on how many times the Federal Reserve will increase rates over the next 12 months, we believe that the market has also already priced in 7 rate hikes. Our job as investors is to estimate the policy rate path after seven rate hikes and what that means for asset prices and portfolio construction.
In this week’s market update, we are going to focus on the path of economic growth and inflation throughout 2022 and what it means for the future direction of interest rate policy and asset prices.
- The market has priced in 6-7 interest rate increases.
- Economic growth and inflation are beginning to SLOW
- As growth slows, invest in secular growth assets
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