Interest rates

The BSBY interest rate benchmark was originally envisioned as a successor to the once-ubiquitous Libor rate. But it failed to gain much traction, and Bloomberg now plans to shut it down next year.

The JPMorgan Chase CEO's comments contrast with the consensus view after 5.25 percentage points of hikes that lifted the benchmark rate to 5.5% — the highest level in 22 years. Money markets are pricing in cuts from next year.

Analysts look at whether the FOMC will bring the last rate hike in the cycle, whether recession is coming, and whether the Fed is making a policy mistake.

One asset manager recalled the prelude to the global financial crisis and the 2001 dot-com bust, when companies that loaded up on debt when costs were low got hit with a steep bill years later.

The bond market's reenergized bulls may want to dial down their excitement, because their fortunes hinge on whether an abstract, almost elusive number, is as low as they assume.

High interest rates could dampen demand for refinancing, which took a hit during the pandemic-era pause in federal student loan payments. "Curb your enthusiasm," one analyst said.

Bond traders have overestimated month-over-month headline inflation heading into four of the last seven Consumer Price Index releases, says strategist Raghav Datla.

When the once-ubiquitous interest rate goes away at the end of June, some businesses that have older loans may see a sudden jump in their payments. Banks, lawyers and business leaders are doing last-minute work to avoid that scenario.

Financial tightening stemming from two recent bank collapses has served as its own check on inflation, according to Federal Reserve Chair Jerome Powell. He said the relatively small rate hike announced Wednesday was not the result of financial stability concerns.

Ahead of this week's Federal Open Market Committee meeting, where it is expected to enact another large rate hike, 11 lawmakers sent a letter to the central bank, urging it not to go too far.