Here's How the Fed's Rate Hikes Will Impact Your Retirement Plan -- for Better or Worse
The stock market dropped this week after the August Consumer Price Index indicated that inflation was higher than expected. Paired with a decent employment report, this inflation data opened the door to continued rate hikes by the Federal Reserve. Rising rates are going to have a handful of important impacts on different asset classes, and investors need to understand how those all fit together in a retirement plan.
Rate hikes are wreaking havoc in the stock market.
It's not always a perfect relationship, but the stock market tends to move in the opposite direction as interest rates. When recessions strike and unemployment spikes higher, the Fed usually slashes interest rates. That boosts economic growth and encourages investor risk appetite, which sends stocks higher.
Source Fool.com
