The Federal Reserve raised its benchmark interest rate by 0.75 percentage point, marking the biggest increase since 1994. Moreover, officials also slashed their economic growth outlook for 2022 to a 1.7% gain in GDP, down from 2.8% in March. The rising inflation and the Fed’s aggressive rate hikes are fostering recession fears. According to Robert Tipp, chief investment strategist at PGIM Fixed Income, “The risk is up because the inflation numbers came in so high, so strong.”
Quality dividend aristocrats in the S&P 500 have an impeccable history of increasing their dividend payouts consistently. With the CBOE Volatility Index up 85.4% year-to-date, fundamentally strong dividend aristocrats could be ideal buys for investors seeking to hedge their portfolios against market fluctuations.
