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Quote On Morning Market 24 March 2023 By Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

The steady decline in bond yields, across tenors, in the US reflect the market perception that interest rates are near peaks. The Fed is likely to pause, after perhaps one more 25 bp rate hike, and if the disinflation trend continues on expected lines, the FOMC may cut rates by end 2023 or early 2024. A lot will depend on the extent of slowdown in the US economy. If a hard landing of the US economy is avoided, equity markets will bounce back. The ongoing stress in the US banking system is a short-term challenge, but a long-term opportunity for equity investors. Market corrections triggered by negative news from the US can be used by long-term investors to buy high quality stocks, which will bounce back once interest rates start trending down.

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