Issue 24 – Without Fanfare, the Fed Surprised the Market with a Mild Pivot

A Snapshot of the Market for the Week Ended June 18, 2021:

Stocks had a rough week. They stumbled because the FOMC decided that enough was enough, by virtue of bearing some responsibility for financial stability. The committee lightly tapped the brakes to reduce speed. To the chagrin of risky cyclical assets, Jim Bullard said on CNBC Friday morning that two years of 2.5% to 3% inflation would meet the new framework, putting the interest rate liftoff at the end of 2022. It was not what the markets expected or wanted. Few traders believed that the committee was ready to reverse course and lose some credibility in the face of only two hot inflation prints that were supposed to be conceived as temporary.


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By Hubert Marleau

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By Hubert Marleau

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