Fed futures now pricing in 55% odds of TWO rate hikes before year-end.
That's a massive shift. Just weeks ago the market was still debating cuts vs. holds. Now we're talking multiple hikes.
What changed? Sticky inflation data, resilient jobs numbers, and the Fed signaling they're not done. Powell's been clear: if the data doesn't cooperate, they'll act.
For stocks, this matters. Higher rates = higher discount rates on future earnings. Growth names especially feel the pressure. We've already seen rotation into value, defensives, and dividend payers.
Watch the next CPI and NFP prints closely. If inflation stays hot, that 55% could become 70%+. And if the Fed actually delivers two hikes, expect volatility to spike and multiples to compress further.
The easy money era is truly over. Position accordingly.
That's a massive shift. Just weeks ago the market was still debating cuts vs. holds. Now we're talking multiple hikes.
What changed? Sticky inflation data, resilient jobs numbers, and the Fed signaling they're not done. Powell's been clear: if the data doesn't cooperate, they'll act.
For stocks, this matters. Higher rates = higher discount rates on future earnings. Growth names especially feel the pressure. We've already seen rotation into value, defensives, and dividend payers.
Watch the next CPI and NFP prints closely. If inflation stays hot, that 55% could become 70%+. And if the Fed actually delivers two hikes, expect volatility to spike and multiples to compress further.
The easy money era is truly over. Position accordingly.
