Lee said that three-month annualized CPI is within “spitting distance” of the Fed’s 2% inflation target, and that means market consensus could be way off with its 2023 expectations for what the Fed is going to do.
“We think this points to a Fed that will be more ‘dovish’ versus consensus in [the] coming months. And in turn, lowers equity and bond volatility. This then means equities can gain more than 20% in 2023,” Lee said.
