RIO DE JANEIRO, BRAZIL - The likelihood that the Federal Reserve (Fed), the U.S. central bank, will raise real interest rates to positive ground in a bid to contain current inflationary pressure is not negligible, the manager said in a letter to shareholders signed by co-founder Rogério Xavier.
"We spent years with a very stimulative monetary policy and loose fiscal policy," Xavier said. "Asset bubbles were created. Now, with the reversal of those policies, those bubbles will likely burst."
According to SPX, the markets that should be most affected by the monetary authorities' move include technology sector stocks . . .