Fed may need to raise interest rates up to three more times, Vanguard says

Vanguard, the mutual-fund powerhouse with $8.1 trillion in assets under management as of August, said the Fed may need to continue hiking interest rates further than many people expect and keep borrowing costs high through late 2024.

The view held by Davis, which was released on Tuesday, is more hawkish than that of fed funds rates traders, who currently see a more than 50% chance that the Fed is done for the rest of the year. Those traders mostly expect the Fed to hold rates between current levels of 5.25%-5.5% before cutting them in the middle or second half of 2024.

Just hours ahead of the Fed’s policy announcement on Wednesday, Vanguard released a separate statement advising investors to avoid reacting to headlines and highlighting the benefits of a balanced portfolio.

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