Last week, the Federal Reserve made it abundantly clear that it intended to raise interest rates in order to control the high inflation. JPMorgan advises investors to ignore the short-term direction and concentrate on valuations in the face of the Fed’s hawkish stance.
Jerome Powell, the chairman of the Federal Reserve, made it clear last Friday that he intends to raise interest rates and keep them there for a considerable amount of time. Strong quantitative tightening measures and the end of free money in the market result from this. Numerous analysts predict that the Fed’s hawkish stance could trigger a U.S. recession.
David Kelly, chief global strategist at JPMorgan Asset Management, advised investors to place more emphasis on valuations and to steer clear of speculative investments like cryptocurrencies.
According to David Kelly, a global strategist for JPMorgan, value stocks will once more take center stage. Investors should now turn their attention away from growth stocks, he continued. Kelly advises selling Bitcoin and other cryptocurrencies while advising avoiding large-cap tech stocks.
For Bitcoin and the larger crypto market, this year has been an extreme roller coaster ride. A severe correction occurred during the second quarter, particularly as a result of the overleverage in the cryptocurrency market and liquidity crisis.
Beginning in July, bitcoin and the larger cryptocurrency market gained momentum. However, after the Fed’s comments, the market experienced a sharp retracement. Kelly anticipates more volatility and a significant chance of a recession.
By the end of 2023, he anticipates a return to normalcy in the economy. The Federal Reserve is overestimating the strength of the US economy because it feels bad that inflation increased while they were in office.
