The start of the Federal Reserve’s meeting today is the only thing markets care about. Speculative trading in Trump Media (DJT) and GameStop (GME) are by far just noise. The broader market worries more about Federal Reserve officials pulling back on its predictions to cut interest rates in 2024.
The economy added too many jobs in May. Furthermore, the inflation report tomorrow will not likely fall to 2.0%. This would require keeping interest rates at over 5% to tighten credit conditions. Additionally, the Fed is slowing down its reduction in the balance sheet runoff. In May, the Fed said it would start on June 1 to slow the cap on Treasury securities it would allow to mature.
By slowing the balance sheet reduction, the Fed lowers the risk of unwanted market disruptions. This gives the Fed room to keep rates at current levels.
In the AI space, Elon Musk said that he would ban Apple (AAPL) devices at his company if Apple added OpenAI at the operating system level. Musk said that is an unacceptable security violation. The billionaire CEO of Tesla is concerned about the privacy risks the AI would introduce.
Musk runs xAI, a startup that seeks to compete with OpenAI. The start-up has a $24 billion valuation, based on the recent $6 billion in series B funding.
Related Stories
