Stocks and bonds rally as Fed pushes back hike expectations

clock

The FTSE 100 has hit a fresh record high after the US Federal Reserve signalled renewed caution on its path towards raising interest rates from their record lows.

As expected, the Fed dropped the word ‘patient’ from its March meeting notes, a move which had been viewed as a more hawkish signal. But the central bank surprised investors by simultaneously cutting growth and inflation forecasts, prompting a sharp rally in a variety of assets. The news prompted the S&P 500 to reverse course, moving out of the red and ending the day 1.2% higher. Ten-year US treasury yields, meanwhile, dropped 14 basis points to 1.92% as traders factored in a lower likelihood of a June rate hike. A number of investment bank analysts subsequently pushed back their e...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Economics / Markets

UK inflation rises to 3.8% in July

UK inflation rises to 3.8% in July

Core CPI also up to 3.8%

Sorin Dojan
clock 20 August 2025 • 2 min read
Bank of England meets expectations and cuts rates to 4%

Bank of England meets expectations and cuts rates to 4%

Lowest level in two and a half years

Isabel Baxter
clock 07 August 2025 • 4 min read
Think tank warns UK fiscal hole could surpass £50bn by 2030

Think tank warns UK fiscal hole could surpass £50bn by 2030

Government not on track to meet ‘stability rule’

Sorin Dojan
clock 06 August 2025 • 1 min read