at its September policy meeting, according to the CME FedWatch tool, which could potentially spark a rally in the stock market.
A pause in rates is also good news for the US recession outlook, as high rates threaten to overtighten financial conditions and tip the economy into a downturn. "I don't think we're going to go into a recession. I think we've been in a rolling recession, hitting different industries at different times, and now I think we're seeing something like a rolling recovery," Yardeni said.
Still, financial conditions are tight, which means the risk of a recession hasn't been completely slashed. Tight credit conditions will also hinder economic growth, Yardeni added. He forecasted the S&P 500 would end the year at 4,600, implying just a 3% increase from current levels.