UPDATE
🌤️ Happy Wednesday
Happy 4th of July! We’re hoping your week got off to a great start and you were able to spend some time celebrating and relaxing with loved ones yesterday.
Below is one of our favorite tweets from the legend, wishing you a happy 4th:
Read time: 2 minutes
WEEK IN REVIEW
📈 Market Performance
S&P 500 (5-day), via Google Finance
Recently, very few weeks have seen a solid, undisturbed uptrend. Often, there are swings throughout the week, and the index (at least recently) will close marginally higher on Friday than it opened on Monday.
Last week was a slight shift from that pattern, as the S&P seemed to increase throughout the week with no real pullback. From Wednesday’s market open to 11:30 ET today, the index shot up a healthy 109.66 points (2.53%).
It’s difficult to say what prompted growth of this kind, but analysts are hoping that this kind of performance in the first week of July can be a pattern that continues throughout the second half of 2023.
💵 Interest Rate Opportunities
Currency by pasja1000, via pixabay
Since the FED has been raising interest rates to combat COVID-time inflation, we’ve seen rates go from nearly 0% to around 5%. Rates set by the FED don’t technically have a defined value, instead, they are usually a range. Currently, the federal funds rate is between 5.00% to 5.25%. This means the cost of borrowing falls between 5% on the lower end and can go up to 5.25%.
On the flip side, inflation (which interest rates are raised to combat) is still relatively high. Again, it’s difficult to calculate an exact rate of inflation, but MorningStar predicts that the rate should fall to 3.5% by the end of 2023.
In the meantime, Treasury Bills (or T-Bills), which we talked about in our Default Debate Looms Over All issue, have seen a resurgence. To give savers a higher return than a typical savings account would give, T-bills currently provide a 3.906% yield which essentially matches the rate of inflation. This can be a great (and relatively safe) option for savers that could hold the value of their money over time.
ONE MORE THING
🤝 Keep in Touch
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Thanks again for reading!
