After a miserable 2022, stocks have surged significantly since the start of this year as investors believe that inflation will continue to cool and the economy could avoid a recession. The Nasdaq Composite is up nearly 13% this year after posting its best January in over 20 years.
After seeing progress in its fierce battle with inflation, the Federal Reserve raised interest rates by 25 basis points at the Federal Open Market Committee’s first meeting of 2023, pushing its key policy rate to 4.5%-4.75%. This marks the smallest rate hike since March last year. Fed Chairman Jerome Powell acknowledged that “the disinflationary process has begun,” noting progress, especially in goods prices.
