What you're not hearing about the day the market stopped believing the Fed

Since last week's FOMC, equity markets are acting like the Powell Fed has locked in a recession. But other markets disagree. Since the November FOMC, the futures-implied funds rate for December 2023 has stopped rising even in the face of repeated statements by Powell that it will be higher than anticipated. At the December FOMC, when the SEP "dot" for December 2023 was raised above 5% for the first time, futures-implied funds rate fell to 4-3/8%, pointing to no hike on net for the year. The peak is now estimated at about 4-7/8% in May, which has not changed since the November FOMC when the Fed announced it would be slowing down. Inflation has peaked by all measures and should be back at the Fed's target. This means markets have stopped believing the Fed, and financial conditions have stopped tightening. The Fed has no credibility anymore, and is pushing on a string to cause a recession, which it will fail to do.