Fed Policy Pivot Accelerates as Inflation Concerns Override Economic Resilience
Despite stronger earnings and ISM data supporting equity rebounds, core PCE inflation is moving in the wrong direction, prompting Fed officials like Kashkari to signal no near-term rate cuts and potential hikes. Market expectations for 2026 monetary policy are being recalibrated with the Fed decision two weeks away.
The Fed is prioritizing inflation control over economic support, creating a more restrictive monetary environment that could compress valuations across asset classes.
fed
inflation
rates
monetary policy