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Forget Rate Cuts, The Fed Will Raise Rates Again In 2024 | Danny Dayan

Supply Shock

NOTE

Focus on Treasury Yields over Fed Funds Rate for Economic Impact

The Federal Reserve analyzes various indicators like the Fed funds rate in relation to their neutral rate, inflation expectations, and actual inflation. However, the Fed funds rate has minimal impact on the economy as most funding doesn't occur at that rate. The crucial metrics are the 5-year to 10-year treasury yields which, when higher than nominal GDP, can help cool down an overheated economy.

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