Hi there,
In fact, a Dovish Fed may be good for the stock market as that basically means that they will not take aggressive acions (such as decrease money supply to rein in inflation). This is usually accompanied by lower interest rates encouraging more corporate borrowing, which in turn leads to greater profits and a robust economy. Businesses will enjoy the ability to finance operations, acquisitions and expansions at a cheaper rate, thereby increasing their future earnings potential, which, in turn, leads to higher stock prices.
Hope that helps!
Hi there,
In fact, a Dovish Fed may be good for the stock market as that basically means that they will not take aggressive acions (such as decrease money supply to rein in inflation). This is usually accompanied by lower interest rates encouraging more corporate borrowing, which in turn leads to greater profits and a robust economy. Businesses will enjoy the ability to finance operations, acquisitions and expansions at a cheaper rate, thereby increasing their future earnings potential, which, in turn, leads to higher stock prices.
Hope that helps!