If the Fed Hikes Interest Rates This Month, History Says This Is the Smartest ETF to Buy Right Now
If interest rates rise, writing a prescription today for the State Street Health Care Select Sector SPDR ETF is a smart idea.
Overview
The next Federal Reserve meeting is on Wednesday, Sept. 16, and it could be a doozy because the central bank could deliver its first interest rate hike in more than three years. Many professional investors believe that will happen as Fed funds futures implied a 59.4% chance of a rate increase as of Sept. 4.
Inflation tells the tale of why a hawkish stance is very much on the table for the Fed. While headline inflation is expected to cool this month, a deeper dive reveals that Core Personal Consumption Expenditures (PCE) are climbing. That gauge, which is a preferred tool of the Federal Open Market Committee (FOMC), strips out volatile energy and food prices, implying that consumers are paying higher prices for an array of goods beyond gas and groceries.
This healthcare could be just what the doctor ordered if interest rates rise. Image source: Getty Images.
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Originally published at www.fool.com.