Thanks to the Fed's "non-move," you need to watch this...
The Next 45 Investing Days
The Federal Reserve did what was expected (and hoped for) last week, when it left interest rates alone.
But the non-move was accompanied by some curious comments – which raised the stakes for Main Street investors.
And those "head-scratchers" are definitely worth a closer look.
In the first of those seemingly contradictory comments, Fed policymakers said they expect stronger-than-first-projected GDP growth for the year – fully 1%, well above their original forecast of 0.4%.
In other words, the American economy is gaining strength.
But not raising interest rates here in June, then, seems like a contradiction – and perhaps a hint of Fed worry that the U.S. economic engine isn't powerful enough to handle an immediate interest-rate increase.
The other head-scratcher goes right to the central bank's credibility with investors.
The Fed signaled that two additional rate increases before December remain on the table, meaning interest rates could surge as high as 5.6%.
But investors don't seem to be listening: They believe there will be only one more rate hike before December. And, at the moment, they are even projecting a 7.9% probability of interest rate cuts in December, as we see here from the CME FedWatch Tool:
So, if you're squinting at all this data, and are tempted to shake your head in bemusement, you're not alone.
It is confusing.
And that's why I want you to hear what TradeSmith Analyst John Jagerson, one of the top experts on accelerated income strategies, says about this latest Fed "non-move." Give him four minutes and he'll tell you what to expect for stocks over the next 45 days.
You can access his insight that was first shared in Constant Cash Flow by clicking the play button on the image below:
If you would like to learn more about receiving insight like this – as well as new trading opportunities every single day of the year – you can click here.
TradeSmith is not registered as an investment adviser and operates under the publishers' exemption of the Investment Advisers Act of 1940. The investments and strategies discussed in TradeSmith's content do not constitute personalized investment advice. Any trading or investment decisions you take are in reliance on your own analysis and judgment and not in reliance on TradeSmith. There are risks inherent in investing and past investment performance is not indicative of future results.
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