Investors Brace for Possibility of No Rate Cuts Through 2024 as Economic Strength Fuels Inflation Concerns

Investors are preparing for possibility of no U.S. interest rate cuts in 2024 as strong economic data suggests inflation could return.

Fading hopes of rate cuts presents dilemma for investors who piled into stocks and bonds expecting policy easing.

Bond investors feeling pain as yields surge on inflation fears, equity investors hedging risks with options and inflation hedges.

Investors reduced exposure to rate-sensitive bonds and boosted commodity stocks, though some see equities as still attractive if yields don't rise much further.

Markets at juncture where next big move in stocks is hard to predict, could be up or down 10% depending on inflation and rates path.