Economic Commentary

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THE FED FACES MARKET FEARS

Economic Commentary |

Tensions around U.S. monetary policy remain high as recession fears grow and markets seek further reassurance that the Federal Reserve (Fed) is prepared to slow or stop future rate hikes as needed.

The Fed will meet this week and make a rate announcement on Wednesday, January 30. Policymakers’ last rate announcement rattled investors, who have watched global economic data deteriorate, but Fed Chair Jerome Powell’s comments on flexibility have calmed markets. Although the bulk of U.S. data remains solid, growing uncertainty over several issues leaves the Fed with a delicate balancing act as it decides its next policy steps.

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Barry Gilbert, PhD, CFA, Senior Analyst, LPL Financial
John Lynch Chief Investment Strategist, LPL Financial