“The markets digested this hawkish Fed pivot that I think surprised people in terms of its magnitude,” Scott Crowe, CenterSquare Investment Management chief investment strategist, told Yahoo Finance Live on Thursday. “It wasn’t so long ago that they were describing inflation as ‘transitory,’ but now they have their sights firmly set on moderating inflation. And I think that’s given the market a lot of indigestion as it starts to digest that pretty dramatic shift.”
Federal Reserve Chair Jerome Powell strongly signaled earlier this week that a March liftoff on interest rates to above their present near-zero levels was in the cards. However, other questions remained — namely around just how quickly the Fed will raise interest rates, and around when and how rapidly the Fed will begin drawing down its nearly $9 trillion balance sheet and tightening financial conditions.
