The Fed has made clear its plan to raise interest rates to contain strong inflation last week, and this has been the case. cryptocurrencies had a negative impact.
With the Fed taking such a tough stance, JPMorgan tells users to focus on valuations and ignore the short-term trend.
Last Friday, Fed Chairman Jerome Powell made it clear that he would raise interest rates and keep them high for an extended period of time.
This means the end of ample money and strong quantitative tightening measures in the US. Many analysts also think that the Fed’s hawkish stance could lead to a recession in the US.
JPMorgan Analyst David Kelly Talks About Bitcoin and Cryptocurrencies
Investors should focus more on valuations and not get caught up in volatile investments like crypto, David Kelly, chief global strategist at JPMorgan Asset Management, told Bloomberg Canada.
“In the US, one foot of the economy is in recession and the other is on a banana peel. Given this background, the best way to take a position right now is to look at valuations. Be sure to weigh in on US and international values, as well as stocks with relatively low P/E.”
Value stocks will once again come to the fore, according to David Kelly, global strategist at JPMorgan. Kelly added that investors in the US should once again stay away from growth stocks at this point.
Kelly claimed that users should stay away from big-capital technology stocks and Bitcoin and dispose of their cryptocurrencies.
Kelly predicts high recession risk in the US, but expects volatility to continue.
The strategist expects the US economy to return to normal by the end of 2023. The analyst concluded his words as follows:
“The Fed overestimates the strength of the U.S. economy because it feels guilty about rising inflation under its watchful eye.”
*Not investment advice.
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