Federal Reserve Rate Preview: Investor Expectations

The video discusses the Federal Reserve's current stance on interest rates, highlighting the unlikely possibility of a rate change in the upcoming meeting. It examines recent inflation trends, comparing PCE and CPI against the Fed's target rates, and provides historical context by referencing inflation in the 1970s. The video also explores market reactions, including the S&P 500's decline and changes in the yield curve, in response to the Fed's tightening bias.

What is the probability of a rate change in the upcoming Fed meeting according to the WARP function?

• 1%

• 0%

• 5%

• 2%

Which measure is the Fed's preferred look at inflation?

• GDP Deflator

• Unemployment Rate

• PCE

• CPI

What historical period is mentioned as a concern for sticky inflation?

• 1990s

• 2000s

• 1980s

• 1970s

How much did the S&P 500 fall as a result of the Fed's tightening bias?

• 8.6%

• 12.3%

• 5.2%

• 10.1%

What trend is observed in the 10-year yield over the past three months?

• Decreased by 1%

• Remained stable

• Increased by 1%

• Decreased by 0.5%