Versace: How Many Rate Cuts Will the Fed Telegraph?

Economic Outlook - The Federal Reserve is expected to raise interest rates by 25 basis points, with a very small chance of a 50 basis point increase [1][2] - The updated economic projections for 2025 and 2026 are anticipated to indicate two rate cuts in 2025 and two in 2026, which is one more than previously stated [4][6] - Inflation pressures are expected to remain elevated, as companies are beginning to restock at higher prices and pass those costs onto consumers [5][6] Market Reactions - A surprise jumbo rate cut could lead to a positive market reaction, but the language from the Fed Chair regarding future cuts will be crucial [3][9] - If the Fed delivers a 25 basis point increase and indicates fewer cuts than the market expects, it may lead to a "sell the news" event [9][10] Company Insights - Companies like Walmart are experiencing inflationary pressures and are adjusting their pricing strategies accordingly [5] - The AI sector is expected to benefit from increased demand, particularly in data centers, with companies like Meta, Amazon, and Google ramping up their business [11] - Dutch Bros is seen as a potential investment opportunity due to its expansion and the recent IPO of Black Rock Coffee, which may lead to a return to normalcy in the market [12][13]