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Is the Fed Starting a New Rate-Hike Cycle? What to Watch This Week
Fed likely to hike rates this week (88%); Kevin Gordon examines past cycles and market implications for investors ahead of Wednesday’s FOMC decision.
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What stands out
The CME FedWatch Tool is pricing an 88 percent chance the Federal Open Market Committee (FOMC) will raise rates this week, and Kevin Gordon at Charles Schwab laid out what prior hiking cycles actually did to markets. That matters because this is not abstract macro, brokerages like Charles Schwab Corporation (SCHW) and exchange operators like CME Group (CME) sit on different corners of the rate trade: one benefits from wider margins, the other from volatility and volumes. Watching this week helps investors see whether the early rhythm of hikes will be transitory noise or the start of a multi-quarter regime shift.
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