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On the SPOT™ blog (03/23/2023) [E..]

This morning (PST) all three major indices are in the green. This is after yesterday's high volatility following comments from Federal Reserve Chairman and Treasury Secretary. Basically, Feds hiked the interest rate by 0.25% perhaps because inflation is still above their target. Given the recent banking system turmoil, Feds stated that they might pause rate hikes soon and are currently expecting only one more rate hike this year. This appears to be a big change from its currently expected trajectory. There were comments that banking system is sound and resilient and that Feds are committed to reigning in inflation. In another event yesterday, Treasury Secretary stated in front of lawmakers that government was not considering "blanket" deposit insurance to stabilize banks. This was perhaps the reason for yesterday's volatility. Now that investors have assimilated this information, there seems to be optimism that rate hikes will stop "soon" and some are even optimistic about rate cuts this year (at the moment, these are only expected in 2024 but remains to be seen based on prevalent conditions).

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