The Fed Squares the Dots—Markets Yet to be Convinced

PGIM Fixed Income

March 2019

Robert Tipp, CFA, Managing Director, Chief Investment Strategist, and Head of Global Bonds

Although the markets’ conviction that the Fed will be cutting rates grew after the March 20th FOMC meeting, markets may not be easily convinced that the economy is back on Easy Street. Instead, the markets are reacting as if we are in a late-cycle investment environment, which gets riskier for stocks as growth ebbs, but more positive for bonds as the rate cycle has presumably crested.