Last week the S&P 500 was down 1.83%. This was mainly due to the Federal Open Market Committee’s (FOMC aka The Fed) releasing the minutes of their December meeting that indicates that they are more concerned with inflation and the USA reaching full employment. Previously the consensus was the Fed would have 3 interest rate hikes in 2022: starting in June 2022. Now that first rate hike has been moved up to a possible rate increase in March 2022. Expect more stock market volatility as the rate hike guessing continues.
What to do? Make sure your investment portfolio is well allocated to your risk tolerance for the long term and that your bond allocation takes in to account rising interest rates. And don’t react to short term market movements. Need help? Reach out for your free E2E second opinion service. Set up a time here.