The peak-inflation narrative is gaining traction, but the bar for a Fed pivot is still high, said Ross Mayfield, investment strategy analyst at Baird.
“There will be trepidation at the central bank given their credibility concerns and desire to avoid the mistakes of the 1970s (i.e., stop and start policy that prolonged the inflationary spell),” he said. “But the crumbs are already being laid for a deceleration in pace of tightening heading into 2023.”
