Falling interest rates present challenges and opportunities. Could economic growth in the United States continue or even accelerate? Or could a crisis knock the economy off its path?
Investors wrestled with similar questions while the Federal Reserve raised rates. Although there were bouts of volatility, a strong consumer and megatrends such as artificial intelligence (AI) powered equity markets to new highs. The S&P 500 Index gained 36.35% for the year ended September 30, 2024.
Bonds, meanwhile, have reasserted their status as income generators and diversifiers, with the Bloomberg U.S. Aggregate Bond Index up 11.57% over the same period.
The lesson? Don’t let uncertainty get in the way of your long-term investment goals. Here are five opportunities to consider as the Fed lowers interest rates.