Last week, the Federal Reserve surprised the markets by citing concerns related to inflation and uncertainty regarding future government policy to justify its hawkish stance on future rate cuts, which led to a significant sell-off in stocks and a rise in bond yields. Despite a modest rate cut of 0.25%, the Fed’s projections indicated fewer cuts in 2025 than previously expected. The U.S. economy, however, showed resilience with strong GDP growth and a robust labor market. The S&P 500 and Dow Jones experienced notable declines, but a partial recovery by week’s end helped offset some of the losses. Overall, the market volatility highlighted investor concerns over inflation and future monetary policy.