Rising Rates

 When it met last week, the Fed strongly suggested two more quarter-point rate hikes will happen this year. I expect three hikes, assuming nothing goes wrong such as a debilitating trade war, serious geopolitical frictions, etc. It’s easy to raise rates if the incoming economic data warrant; it’s very embarrassing to pull back. Moreover, there’s no need for markets to price in higher rates now given substantial future uncertainty.

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