Everything hinges on US-Iran negotiations now as that’s going to influence future inflation and growth expectations.
One thing that keeps being funny is the market pricing rate hikes for the SNB and rate cuts for the Fed. The latest BofA FMS survey showed that most investors expect the Fed to cut rates. The more timely labour market data like US jobless claims, haven’t been pointing towards rate cuts at all, on the contrary, there’s been a clear and strong improvement.
The Fed has been missing on its target since 2021 and the end of the war might even boost economic activity
How have interest rate expectations changed after this week’s events?
