U.S. economy grew at 1.3% in Q1, slower than expected. Inflation may continue to decline, easing pressure on Fed to cut rates. Experts have mixed views on potential impact.
The Fed kept rates unchanged but announced a significant reduction in its quantitative tightening program starting in June. Redditors have diverse opinions on its effectiveness and potential impact on inflation and investment strategies.
Powell stated on Tuesday that a prolonged period of restrictive monetary policy may be necessary, refraining from offering explicit guidance on a rate-cutting strategy.
U.S. Treasury yields at highest since mid-November 2023 due to economic resilience, fiscal spending, and inflation pressures, impacting government debt costs and bond ETFs.
Let's Rewind
2022 and 2023 were hectic - war, bank crises, and bear markets.
Inflation was still running rampant - with the core PCE having just peaked at +6.4% in February 2022. These consistent out-of-control inflation reports caused the Federal Reserve to take action by doing the only thing they know how to do - raise interest rates.