The day started ugly on Wall Street and ended in the same fashion. The Dow fell 533 points, or 1.5%, to 33,290; the S&P 500 fell 55 points, or 1.3%, to 4,166; and the Nasdaq fell 130 points, nearly 1%, to 14,030. It was the market's worst week since October, with a decline of about 3.5%, reports CNBC. The glum mood began after a Fed official went on CNBC and predicted that the agency would begin raising interest rates next year, earlier than previous estimates of 2023.
It's an acknowledgment that a rebounding economy with near-record prices for homes and stocks may not need super low rates much longer, per the AP. A recent burst of inflation may also be increasing the pressure, but any pullback in Fed support would be a big change for markets, which have been feasting on ultra-low rates for more than a year. It marked a “U-turn on Easy Street,” as strategists at BofA Global Research described it.
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