Trump Bull Market at Risk as Federal Reserve Prepares to Hike Interest Rates
The Federal Reserve is expected to raise interest rates on September 16, which could have significant implications for the stock market.
Persistently elevated inflation, fueled in part by Trumpflation, inflation driven by President Donald Trump's policies, has increased the likelihood of a rate hike.
Trumpflation has been driven by the president's tariff policy and the Iran war, which have pushed up prices on energy and core goods. The AI infrastructure build-out has also contributed to higher prices, as companies invest heavily in artificial intelligence hardware.
A rate hike could force investors to reevaluate their expectations for AI stocks, which have seen stratospheric valuations fueled by growth forecasts. If growth forecasts come down due to higher lending rates, it will likely lead to a rethink of these valuations.