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The Fed is playing with fire
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The Fed is playing with fire

VP Research
Feb 5, 2022
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The Fed is playing with fire
blog.variantperception.com

Markets have been aggressively pricing in Fed hikes as inflation starts to bite for many households.

Source: Bloomberg, Macrobond, Variant Perception

Rampant inflation has pushed real rates into deep negative territory, leaving the Fed to thread the needle with raising rates to dampen inflation without causing a major upset in growth conditions and asset markets.

Stephen Roach's article, The Fed is playing with fire, discusses the challenges faced by the Fed today and the increasingly choppy macro environment for investors.

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The Fed is playing with fire
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