‘Higher for longer’ was the common view back in 2022. That changed last year when banks started collapsing (remember the swift demise of Silicon Valley Bank and Credit Suisse?)
Investors turned dovish on rates last autumn after a batch of weak data. That view launched a gigantic market party shortly after. The global blue-chip equity barometer - US S&P 500 Index - rose a stunning 25 percent in the Nov-Jan quarter. Nvidia (NVDA) soared by a $1 trillion; many speculative stocks jumped (see Bitcoin below).
However, the market could be getting ahead of itself. The global economy is doing fine, but not at the blistering pace that the market is...