“The likelihood of a Fed interest rate hike went from 30% to 90% as several Fed governors tested the waters Friday by alluding to an interest rate hike”
This week our attention will turn to the Fed and the jobs number. Unless the jobs number is bad, we believe the Fed will have the ammo it needs to raise interest rates.
The Fed alludes at an interest rate hike
Last week there was not big economic data but it was interesting to see that the likelihood of a Fed interest rate hike went from 30% to 90%. This could have happened because several Fed governors, including Janet Yellen, spoke on Friday and tested the waters by alluding to an interest rate hike. If they do make an interest rate hike in March, that would leave room for two more this year, which is right on track with what they said they would do at the beginning of the year.
The Fed has what it needs for an interest rate hike
While many people did not believe the Fed would do this, the market did not trade back as they tested the waters. The market needs a little inflation in the system and currently it is where the Fed wants it to be for a rate hike. This is why we will be watching the jobs number this week, as that could also influence the Fed.
Happy Birthday S&P 500
On Saturday the S&P 500 turned 60 years old! The S&P 500 has almost $2.4 trillion indexed to it. The reason it has become such a large and popular gauge is that it is measured by market capitalization. The DOW is gauged by price or other indices combinations. This design which was created 60 years ago, ended up being highly successful and the most watched by far.
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Fi Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. Fi Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Economic forecasts set forth in this presentation may not develop as predicted.
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