The Federal Reserve's interest rates are close to neutral, and the AI boom along with rising metal prices may enhance inflation stickiness

According to Jin Ten, Rushabh Amin, portfolio manager of Allspring's Global Investment Cross-Asset Solutions team, pointed out in a research report that the current target range of 3.5% - 3.75% for the federal funds rate set by the Federal Reserve is very close to neutral levels and will not further exacerbate inflationary pressures. He expects that the market's focus will gradually shift to the appointment of the next Federal Reserve chair, with investors generally anticipating that the new chair may be more inclined to cut interest rates. The current market widely expects that the Federal Reserve will maintain interest rates at its monetary policy meeting this week.