The Fed is finally ready to switch up their tone. Moving from a contractionary to an easing phase, which historically leads to investment opportunities for those who can read the market.
But with change comes challenges. How long will this cycle last? It’s tough to say but we can look to the past for clues.
During this purgatory phase in between the contraction phase and the easing phase, some sectors thrive while others slow down. Meanwhile, the economy follows the Fed’s lead, eventually slowing down until the Fed steps in to stimulate it again.
As we approach the easing phase, investors should be ready for potential market volatility. This is what we saw in the past three cycles.
The key is to be ready for anything and keep an eye on the leading indicators. In the end, it’s all about making smart decisions.