taking a break after 10 consecutive hikes over the past 15 months. But it also projected two more quarter-point increases before year-end.
That move - of simultaneously holding rates and signaling future rises - may have been a deliberate strategy on the Fed's part in order to rein in financial-market speculation that the central bank's policy tightening is nearing its end, according to Rosenberg. "I'm thinking this move to signal two more hikes was a strategy to ensure that the stock market didn't soar on the"pause" as every Tom, Dick and Harry strategist was telling investors always happens when the Fed moves to the sidelines," heRosenberg has made it clear over the past few months thatwhen it comes to raising rates.
Higher rates tend to slow the pace of price increases because they encourage saving over spending and make borrowing more expensive. But they also chip away at demand across broad strips of the economy, pulling down the prices of assets like stocks.
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