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Now earlier today, the Federal Reserve actually surprised the markets to a degree with its

so-called hawkish pause as expected.

And not too long ago, the expectation was actually for a hike in the June meeting.

But I think in recent weeks and maybe a month or so, the sentiment had shifted.

I think the inflation data that came out earlier today and yesterday also helped set the

tone for the expectations that the Fed would not hike in June.

But the markets initially received the so-called good news as a hawkish pause because at the

same time that the Fed decided to skip the rate hike for June, although in the Q&A section,

Powell seemed to be walking away from the word skip.

But in any event, they didn't raise rates in June, but they actually guided expectations

higher for future rate hikes.

In fact, Powell said that the Fed expects rates to be at 5.6% by the end of the year, which

would imply another 50 basis points of hikes.

So two more 25 basis point hikes, which is more than the market thought.

Remember, a lot of people were still thinking the Fed would be cutting rates by the end of

the year.

They basically ruled that out.

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