Mackenzie's Reid expects a jumbo cut from the Fed in September

Dustin Reid, chief strategist for fixed income at Mackenzie Investments, says he expects the Federal Reserve to hold off on rate cuts in July, but to be moved into making a double cut — half a percent — in September, and worries that the central bank may be waiting too long to act, as the labor market is starting to show some cracks. Reid said a bigger cut might be taken as a positive by the market if inflation hasn't spiked, labor markets are slow but steady and the action suggests that the Fed is trying to stay ahead of the action. That action and uncertainty has Reid favoring intermediate bonds now, with two- to five-year maturities. John Kosar, chief market strategist at Asbury Research, says he is risk-on right now, being fully invested and continuing to ride the wave that started churning after the stock market bottomed out in April. Kosar acknowledges that the market's rebound has been fast and big, and so he's expecting a reversion to the mean that would push him to a risk-off position, ahead of what he considers a foreseeable market tumble. Plus, in The NAVigator segment, Mike Schueller — co-manager of the Allspring Income Opportunities fund — says he foresees a "muddle-through economy," which is actually a good environment for high-yield bonds, which face little default risk at a point where recession has "receded into the background."