Pure speculation here, but the FED basically said that they do not plan on increasing rates because increased bond yields and a decreased stock market was doing the job for them. What happened? The market rallied for 6 weeks and now yields have decreased and the market has approached ATHs again.
The market is pricing in 4-6 rate cuts for 2024 right now. So my question: what if no rate cuts happen and we just stay at the current FED fund rate for the forseeable future? Does the market sell off, stay flat, or does the rally continue (even though so far this year we have been red)?
I personally think we will see some significant volatility in 2024 with multiple 5-10% swings vs a steady increase in market valuation if no or just 1-2 rate cuts occur.
Thanks for your opinions and thoughts!
