Federal Reserve officials believe interest rates are high enough to guide inflation back to 2%, expressing confidence that so-called long and variable lags in monetary policy will hold true. Leading off this week's lineup of speeches from the central bank's policymakers, Richmond Fed President Tom Barkin said on Monday he remained optimistic that current rates will cool inflation—and that the Fed "knows how to respond" if the economy overheats or slows more than expected. John Williams of the New York Fed said monetary policy is in a "very good place" right now and rate cuts are likely to follow. Minneapolis Fed President Neel Kashkari was less optimistic. Resilient demand and housing market activity may indicate that inflation is settling above the Fed's target, Kashkari warned. He also said the Fed may need to keep rates at current levels for an "extended period" to combat inflation. Boston Fed President Susan Collins echoed this sentiment, saying on Wednesday it will take longer than previously thought to bring inflation under control.

The jobs report on Friday suggested that at least some corners of the economy are beginning to feel the pressure from higher borrowing costs and softer demand. The US added 175,000 jobs in April, the fewest in six months and below what economists anticipated. Wage growth also cooled during the month, falling to its lowest level in nearly three years, while the unemployment rate went up a notch to 3.9%. The slowdown in hiring tempered concerns among market participants that an overheating economy would prevent the Fed from delivering on its plans to cut rates this year. No matter what the future holds, it will be crucial for investors to identify opportunities that have yet to be uncovered. With a growing amount of capital moving into alternatives, PGIM has published a new report highlighting investment ideas across a broad spectrum of the alts universe.