FOMC Meet Outcome: Gargi Chaudhari's Take On If The Fed Rate Cut Will Be Followed By Recession

Gargi Chaudhuri, Managing Director, Chief Investment and Portfolio Strategist, Americas at BlackRock emphasizes the importance of the speed of the rate cutting cycle for both bond and equity investors. She believes that the reason and rationale for the fed rate cut is going to be a key factor as past rate cuts have often been followed by a recession. While there are data points showing a softening economy including the labor market there is no clear indication of a recession yet. Chaudhuri advises investors to focus on quality in the equity market and consider investing in high-yielding bonds. She also points out that the fixed income markets in the U.S. garner good income and holding long duration bonds may be a sensible decision. Lastly she mentions that while markets has already priced in many rate cuts it is highly unlikely for rates to reach 0-2%.

#fedratecut #usfed #fed
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[PaulStephenRudd-ub]

The rising interest rate can surely control inflation, but won't prevent erosion of the eroding purchasing power of the US dollar. I have learnt my lesson this time. The banks can't be making money off my money, while inflation eats into it. I have set aside 650k to invest in the stock market now, since that keeps up with inflation, but I don't know how to get started.

[abhishekgupta]

She missed a data point. Recession doesn’t come immediately, will take 4-6 months.
Unemployment rate is 23% higher already from the base. Will jump soon.

[Koundinya]

1. Stable Rate:
Neutral & Positive.
Stable Bullish expected Nifty 26300 by Oct'24 end.


2. Rate cut: 25bps-50bps
FII push money into markets.
High Bullish expected Nifty 27000 by Oct'24 end.

[luisguzman]

The sky could be falling. Theyll never admit recession lol