While investors eagerly await a possible interest rate cut from the Federal Reserve at its September FOMC meeting next week, uncertainty is likely to continue in the market.
Katy Kaminski, Chief Research Strategist and Portfolio Manager at AlphaSimplex, joins us to discuss the market outlook in light of the expected shift in fiscal policy.
Kaminsky noted that the discussion of rate cuts has been hovering between 25 and 50 basis points, and stressed that “the jury is still out,” but regardless of the size of the cut, “the Fed is changing course” which will impact multiple aspects of the economy and “present both opportunities and challenges for investors.”
Kaminski said sectors such as borrowing, real estate and consumer staples will benefit from the rate cuts, and he also expects the market to move away from sectors such as technology, but he warned investors that the fight against inflation isn’t over yet.
“I think you need to be mindful of the possibility of higher inflation going forward and think about areas and sectors of your portfolio or investments that will actually increase your gains in periods of inflation. Gold (GC=F) is a good example,” Kaminsky told Yahoo Finance.
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This post was written by Angel Smith
