#FedRateCutAffectsDollarTrend The Federal Reserve's interest rate decisions have a major impact on financial markets. Here’s how different asset classes react: 1. Stock Market Rate Hikes (Higher Rates) → Bearish for Stocks Higher borrowing costs for businesses → Lower profits. Consumer spending slows → Revenue declines. Growth stocks (tech, startups) suffer more due to reliance on cheap capital. Rate Cuts (Lower Rates) → Bullish for Stocks Cheaper borrowing fuels business expansion. Increased consumer spending boosts corporate earnings. Growth stocks benefit the most. 2. Bond Market Rate Hikes → Bond Prices Fall Existing bonds with lower yields become less attractive. Investors demand higher yields on new bonds.