Cathie Wood Has a Bold Prediction for 2024
Stocks have been rallying in recent weeks on the hopes that U.S. inflation will continue to come down and that interest rate cuts may be around the corner. That, however, is by no means a certainty. But a lower rate of inflation would eventually lead to lower interest rates, which, in turn, would make growth stocks more attractive buys.
One portfolio manager who is optimistic about inflation coming down next year is Cathie Wood, whose Ark Innovation ETF (exchange-traded fund) is often viewed as a barometer for growth stocks. It's up 55% this year. But if Wood's expectations for next year prove accurate, then the fund could just be getting warmed up.
Since shortly after the start of the pandemic, the Federal Reserve had been holding the benchmark federal funds interest rate at essentially zero. But about two years ago, in response to sharply rising inflation, the Fed began a series of rate hikes intended to curb inflation. Those hikes had the desired effect, but while inflation did ease, its decline has stalled in recent months in the 3% to 4% range -- still above the Fed's target of around 2%.
Source Fool.com
