It is not a rate cut. Only when the Strait of Hormuz is completely opened and trade is fully restored, will a possible rate cut later this year happen.

But the market has seriously underestimated the risk of the conflict dragging on! The longer oil prices stay high, the more easily they can seep into the prices of all goods.

When that time really comes, even if jobs collapse, the Federal Reserve can only weld interest rates in place at a high level, watching stagflation arrive right in front of its eyes.

This is not alarmist talk. Deutsche Bank has already directly adjusted its expectations, saying that “the Federal Reserve will hold steady this year”; the money market is also… “定”