- June 14, 2022
- Posted by: Stratford Team
- Category: Economy
- Markets in disarray as traders scramble to price in Fed warpath
- S&P 500 enters bear market, crypto implodes, dollar powers up
- Despite all the panic, there’s also some encouraging news
Bear market blues
All hell has broken loose in financial markets. Another scorching hot US inflation report shattered hopes that the Fed might be able to take its foot off the brakes later this year, sending traders scrambling to recalibrate the trajectory for interest rates and wreaking havoc in every asset class.
Market pricing has adjusted at a furious pace. Fed funds futures contracts imply a 95% probability for a 75 basis points rate increase this week and similar dynamics for July, amid intensifying speculation that the central bank will throw its own forward guidance to the wind and crank up borrowing costs at lightning speed.
The impact has been devastating. Stock markets fell off a cliff with the S&P 500 losing almost 4% yesterday to officially enter a bear…
