by Connor Darrell CFA, Assistant Vice President – Head of Investments
There was much for the markets to digest last week, with the Federal Reserve opting to cut interest rates once again by an additional 25 bps. The committee of Fed policymakers were divided in their decision, with two members arguing that no cut was needed and one arguing for a larger cut. Stocks sold off marginally following the decision, but ultimately stabilized and were set to end the week in positive territory before news broke on Friday afternoon that lower-level Chinese officials cut their visit to the U.S. short. Markets interpreted this as a negative sign for the higher-level trade talks scheduled for early October.

In the bond market, yields crept lower as rising geopolitical risks in the Middle East seemed to push investors toward the relative safety of U.S. Treasuries. But with some members of the Federal Reserve policy committee dissenting this past week, markets will likely have less clarity about the future direction of interest rates throughout the remainder of 2019. Given this lack of clarity, investors should expect more interest rate volatility in the months ahead.