Published on 10 Nov 2023 on Zacks via Yahoo Finance
ETFs to Play Amid Stagflation
The U.S. economy has been experiencing sticky inflation, higher rates and slower growth, meaning a stagflationary scenario. The Fed meeting in September projects that the Fed Funds rate will increase to 5.6% by the end of 2023, and then slip to 5.1% in 2024 and 3.9% in 2025.
Meanwhile, the Fed stayed put in November. This indicates one additional 25 basis point rate hike by the end of the year. Median PCE inflation is expected to be 3.3% in 2023, 2.5% in 2024 and 2.2% in 2025 while real GDP date is expected to be 2.1% in 2023, 1.5% in 2024 and 1.8% in 2025.
Personal spending in the United States rose by 0.7% from a month earlier in September 2023, following a 0.4% increase in August and beating the market consensus of a 0.5% advance. Spending on services saw a considerable uptick of 0.8%, while spending on goods also rose by 0.7%.