Charles Schwab: Even though the Federal Reserve has raised interest rates multiple times, the U.S. economy is still expected to remain robust

According to Kevin Gordon, the Chief Macro Research and Strategy Officer at Charles Schwab, the current economic backdrop remains relatively favorable for the Federal Reserve to raise interest rates. Even as we enter multiple rate hike cycles, the U.S. economy is likely to remain robust.

He pointed out that rate hike cycles are often accompanied by significant market volatility. According to historical data he cited, within 12 months of the Federal Reserve initiating a rate hike cycle, the average maximum decline of the S&P 500 index exceeds 10%.

Analysis also indicates that interest rate policy is just one of the factors affecting stock prices. Currently, investments in the AI sector and inflation driven by rising oil prices seem to be the main factors driving the stock market.