This year has been one for the record books for the stock market. With the three major indexes setting all time highs at some point, it was without a doubt the year of the stock. But these rises coincided with some of the lowest interest rates in recent memory, something which the Fed is likely to correct in the coming months.
John Caruso, senior market strategist for RJO Futures, told CNBC: “I do think there’s going to be a point when the [stock] market is going to look at rising yields, there’s speculation out there the Fed is behind the curve as well. At this point I don’t think the stock market wants to see a strong dollar, higher yields,” echoing fears that the market correction people have been expecting may be coming through currency.
The dollar may rise as the scheduled Fed meetings keep coming up. BNN reports:
The greenback, which rose on Tuesday after Federal Reserve Chair Janet Yellen said the Fed needs to continue gradual rate hikes despite broad uncertainty about the path of inflation,
If Yellen keeps up her “hawkish” attitude and the Fed continues to offload some of its balance sheet, we may see the dollar rally even more. Investors should keep an eye on what is yet to come with respects to the Fed and how it will play with the markets. Currency traders may be in for some volatility in the coming months, as the combination of Fed meetings and details on the emerging Trump tax plan become clearer.
If you would like to read CNBC’s report on this morning’s market activity, click here.
To read BNN’s article on news out of the Fed, click here.
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