Big Question for the Fed Is What Next, Says Misra

The transcript discusses the Federal Reserve's interest rate hikes, market pricing, and the concept of overshooting the neutral rate. It explores how the Fed's actions might impact risk assets and inflation targets. The discussion also touches on the challenges of balancing the desire to overshoot the neutral rate with inflation targets, and the Fed's current stance on these issues.

What is the market's expectation regarding the Fed's rate hikes?

• The market expects a fully priced rate hike.

• The market expects a decrease in rates.

• The market expects no rate hikes.

• The market is uncertain about rate hikes.

What is a key concern if the Fed overshoots the neutral rate?

• The economy will grow too fast.

• Risk assets may react negatively.

• The stock market will boom.

• Inflation will decrease significantly.

What is the Fed's current stance on inflation?

• The Fed plans to decrease inflation rates.

• The Fed is indifferent to inflation changes.

• The Fed is cautious about overshooting the inflation target.

• The Fed is eager to overshoot the inflation target.

How does the Fed view the relationship between the neutral rate and inflation?

• Balancing both is challenging.

• Both should be overshot simultaneously.

• They are unrelated.

• Inflation is more important than the neutral rate.

What is the Fed's projected movement above the neutral rate in 2019?

• Significant increase above neutral.

• Barely starting to move above neutral.

• No movement above neutral.

• A decrease below neutral.