The Fed shocks the market triggering an abrupt selloff

The U.S. Federal Reserve surprised markets this week with a small rate cut (expected), a forecast for fewer rate cuts next year and higher inflation (very unexpected).

This was a more hawkish report than the market expected.

The stock market reacted very negatively on Wednesday, with the S&P 500 losing 3 percent in just two hours. Bond yields moved higher.

Was the stock market selloff this week justified?

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