S&P 500 and Chicago Fed National Financial Conditions Index Should investors stay optimistic? The rise in the Chicago Fed Financial Conditions Index is seen as a bullish signal for the S&P 500, suggesting potential for further upside. Image: BofA Global Research
10-Year/2-Year Treasury Yield Curve Around First Fed Rate Cuts The U.S. yield curve typically steepens once the prospect of interest rate cuts by the Fed becomes more imminent, rather than when the Fed actually stops hiking rates. Image: Goldman Sachs Global Investment Research
S&P 500 Pre and Post Fed Rate Cuts The S&P 500 typically shows positive performance in the 12 and 24 months after the Fed’s first rate cut, unless the U.S. economy enters a recession. Image: Goldman Sachs Global Investment Research
Atlanta Fed GDPNow U.S. Real GDP Estimate The GDPNow model estimate for U.S. real GDP growth is 2.5% for 2024:Q2, suggesting that the U.S. economy is experiencing moderate growth and maintaining a positive trajectory. Image: Federal Reserve Bank of Atlanta
Current Market Pricing for Fed Funds Rate Despite initial expectations for significant interest rate cuts in 2024, the market is pricing in the first Fed rate cut at the September 18th meeting. Image: BofA Global Investment Strategy
Probability of Fed Rate Cut With signs of U.S. inflation cooling, can investors and traders expect the Federal Reserve to cut interest rates twice by the end of the year? Image: The Daily Shot
Fed – The Distribution of FOMC Voters Should investors bet for a hawkish Fed policy tone in 2025, as the central bank remains focused on its fight against persistent inflation, even if it means risking some economic pain? Image: BofA Global Research
Fed Rate Cuts 78% of FMS investors predict that there will be either 2, 3, or more Fed cuts over the next 12 months, reflecting their optimism about the likelihood of interest rate reductions. Image: BofA Global Fund Manager Survey
Implied Fed Funds Target Rate The FOMC’s latest dot plot projects only 25 basis points of rate cuts for 2024, which looks hawkish at first glance. Image: Bloomberg
Fed Funds Rate and Fed Funds Futures Deutsche Bank’s forecast for the fed funds rate remains more hawkish than many mainstream projections, expecting a single rate cut in December 2024, followed by modest reductions in 2025. Image: Deutsche Bank