Prior to the release of the University of Michigan Consumer Sentiment Index on August 15th, which recorded an increase in inflation expectations, there was a 99% chance of the Federal Reserve (the “Fed”) cutting interest rates by 0.25% in the upcoming September meeting. However, after the data were released, this probability decreased to 92%, and it currently stands at 85%.
Fed Chairman Jerome Powell will deliver a speech at Jackson Hole on August 22nd, and there are three possibilities:
He may state that the Fed is discussing monetary policy
He may warn about the current situation
He may confirm the expectations for an interest rate cut and provide positive signals
One of the major risks in the market currently is the extreme concentration in certain stocks, in addition to the potential for stagflation, and the excessive enthusiasm surrounding artificial intelligence.
At The Family Office, we prefer private equity in companies with growth potential, as it offers stable returns, in addition to the real estate sector, which helps hedge against inflation. We also recommend diversifying the portfolio and focusing on alternative investments.
Watch the full interview above.
