State Street Sees Breakdown of Traditional Correlations in Markets

The video discusses how markets are reacting to inflation coming in harder than expected, with the Fed potentially hiking rates faster than anticipated. It highlights the breakdown in traditional market correlations, such as the dollar moving contrary to expectations. The video also examines the changing volatility environment and its impact on market strategies, emphasizing strong fundamentals and the potential rotation from bonds to equities.

What are some of the factors that may influence market reactions to inflation?

How has the volatility environment changed according to the text?

What does the text suggest about the relationship between fundamentals and market strategies?

In what context does the text discuss asset class preference?

What potential market rotation is mentioned in the text?