Market MakeHer Podcast 40. Preparing for Rate Cuts: What are Bond Funds?
Jun 14, 2024
The team dives into the bond market, revealing how cooling inflation could lead to potential rate cuts. They explain what Bond ETFs are and why they're a great way to invest, especially when savings account rates drop. The discussion highlights the importance of understanding duration and compares various fixed-income options like CDs and Treasurys. Listeners learn how falling yields can boost bond ETF prices and the practical steps to invest smartly in bonds or ETFs. Perfect for anyone wanting to make their money work harder!
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Dot Plot Is A Projection Not A Plan
- The SEP/dot plot is a projection, not a Fed plan, and it changes with incoming data.
- Jess Inskip says the dot plot gives insight but the Fed adjusts policy as new data arrives.
Cooling Inflation Makes Cuts More Likely
- Recent CPI and PPI prints lower the odds of Fed tightening and raise chances of rate cuts.
- Jess Inskip notes Powell sounded less convinced, making cuts feel more likely soon.
Lock Rates Before Fed Cuts
- If you expect Fed cuts and falling savings yields, consider locking rates in via bonds or CD ladders.
- Jess Inskip recommends moving excess high-yield savings into treasuries or bond products before rates drop.