Running the Fed minutes through a natural language processing model shows that Fed sentiment is currently at peak hawkish at levels last seen in 2019, 2006, and 2000, see the first chart below. With inflation trending lower and growth slowing, we should expect the Fed to turn more dovish after their meeting on Wednesday. And a Fed pause is good for credit and equities because then markets know that we are at the end of the rate hiking cycle, see the second chart.
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