San Francisco Fed President Mary Daly yesterday stated her support for aggressive interest rate hikes to reduce inflationary pressure yesterday. "We need to do that expeditiously, and I see a couple of 50 basis point hikes immediately in the next couple of meetings to get there," she said. Forty-year-high inflation, lingering supply chain disruptions, and recent geopolitical crises have evoked fear that the Fed's tighter monetary policy to combat price increases will push the U.S. economy into recession.
The equity markets have enjoyed a mini rally over the past few days. However, the market retreated again yesterday as economic data increased the possibility of more extensive interest rate increases, while JPMorgan's Jamie Dimon warned investors of an "economic hurricane." Amid the volatile scenario, high-yield ETFs are considered attractive investments because they can hedge against market uncertainties and generate a regular income stream.
