‘Peak Goldilocks’: The markets have bought the Fed rumors — watch for them to sell on the news

Photo: WASHINGTON, DC - SEPTEMBER 04: Stephen Miran, currently the Chairman of the Council of Economic Advisors, is sworn in prior to testifying before the Senate Banking, Housing and Urban Affairs Committee September 4, 2025 in Washington, DC. Miran has been nominated by U.S. President Donald Trump to be a member of the Board of Governors of the Federal Reserve System. (Photo by Win McNamee/Getty Images) (Credit: Photo by Win McNamee/Getty Images)

• The S&P 500 hit a new record as markets priced in a 25bps Fed rate cut, with “peak Goldilocks” optimism driving risk-on sentiment, Goldman Sachs says. Wednesday’s Fed meeting will be tense: Two members of the FOMC have been accused of crimes by the Trump Administration and they will be sitting across the table from Stephen Miran, Trump’s new advocate for rate cuts. Investors will scrutinize Chair Jerome Powell’s communication for future easing signals and may sell on the news.

The S&P 500 hit a new record high yesterday, up 0.47% to 6,615.28. Futures contracts on the index are up 0.21% this morning.