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THE UNITED STATES IS BECOMING MORE NORMAL

  • Scott Carmack
  • Jun 30, 2018
  • 1 min read

Updated: Mar 11, 2024




Forward projections issued by Federal Reserve members after the June meeting sparked broad criticism for its “hawkish” guidance. The “dot-plot” was revised from an expected three rate hikes in 2018 to four. Lost in all of the postannouncement commentary was the fact that only one voting member adjusted their baseline forecast, which was enough to push the median projection higher. Headlines focused on the “looming dollar crisis,” the “vulnerability of Emerging Markets to a rising dollar”, and of course, potential for “imminent yield curve inversion” in the United States.

 
 

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The risk that the Fund could lose money if the issuer or guarantor of a fixed income security is unwilling or unable to make timely payments to meet its contractual obligations. The risk that foreign currencies will decline in value relative to the U.S. dollar and adversely affect the value of the Fund’s investments in foreign (non-U.S.) currencies. The derivative instruments in which the Fund may invest for hedging purposes may be more volatile than other instruments.

 

The Fund invests in fixed income securities or derivatives, the value of your investment in the Fund will fluctuate with changes in interest rates. These risks could affect the value of a particular investment by the Fund. Investment in or exposure to high yield (lower rated) debt instruments (also known as “junk bonds”) may involve greater levels of interest rate, credit, liquidity and valuation risk than for higher rated instruments. When the Fund invests in other investment companies, including ETFs, it will bear additional expenses.

 

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yield, increase the volatility of the Fund ad/or cause a decline in NAV.

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