The Federal Reserve has turned inflation-fighter – how do you invest now?

The US Federal Reserve has become much more hawkish on inflation and less concerned with the markets' reaction to rising interest rates. John Stepek explains way, and picks the best sector to buy to take advantage.

Fed chair Jerome Powell
Jerome Powell: turned hawkish
(Image credit: © US Federal Reseve)

Ever since the late 1980s or so, the Federal Reserve, America’s central bank, has earned itself a justified reputation for being a pushover when it comes to markets.

This manifested itself in the phrase the “Greenspan put”. This was the idea that Alan Greenspan, Fed governor between 1987 and 2006, would always act to cushion markets if they looked wobbly.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.