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The Federal Reserve is widely expected to announce Wednesday that it will keep interest rates at a 22-year high in a bid to tackle inflation without harming the buoyant US economy.However, economic growth has remained surprisingly robust, solidifying expectations of a so-called "soft landing," when the Fed smoothly brings down inflation without tanking the economy.
The Fed is standing pat, for now, in part because the U.S. economy has been moving mostly in the direction that Chair Jerome Powell has hoped for
On the other hand, turbulent financial markets have sent longer-term rates on U.S. Treasurys surging, driven stock prices lower and raised corporate borrowing costs.
Treasury yields at 5% are actually normal compared to historical standards, Oppenheimer's chief market strategist said.
Unlike previous recessions, any potential slowdown this time around would be "engineered" by the Fed, said Apollo chief economist Torsten Sløk.