After pausing their June meeting, the Federal Open Market Committee raised short-term rates by 25 bps in July. With no August official meeting scheduled, the committee plans to meet in Jackson Hole for a symposium at the end of this month, which has historically led to some economic volatility.
The market is currently neutral on the odds for a September hike. Data-dependent, as always, Fed Chair Powell will no doubt be monitoring the labor market closely while also considering the broader price level here in the U.S. Markets anticipate the Fed is at or near the end of its current hiking cycle. If that were not the case, we would likely see much higher market volatility ahead.
All eyes will be on the remainder of the second-quarter earnings season. While investors will also be watching the response by the Fed to future inflation prints and other economic data releases to hit the tape.
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