The 40-year high inflation and the Fed’s aggressive rate hikes have led to heightened market volatility. The Fed announced a 75-basis-point rate increase earlier this month, marking its most aggressive hike since 1994. Another 75-basis-point hike might be undertaken by the central bank in the coming month, followed by a 50-basis-point increase in September.
The Fed’s hawkish stance raises the possibility of the economy tipping into a recession. However, Jack Ablin, chief investment officer at Cresset Capital, said, “We’re calling for a small ‘r’ recession. It means it’s not going to be protracted, and things aren’t going to fall apart.”
