Trump may claim the war is ‘complete,’ but Wall Street expects the Fed to stay hawkish long after the conflict has ended

Macquarie economists warn that ongoing geopolitical conflict could cause significant psychological damage to investors and consumers, potentially affecting economic data releases in May. Wall Street expects the Federal Reserve to maintain hawkish policies even after any conflict resolution, suggesting continued monetary tightening despite potential war conclusion claims.

• →Macquarie economists expect ongoing conflict to cause 'psychic damage' to investors and consumers through month-end.
• →Economic data for April, released in May, is expected to be adversely affected by the conflict's impact.
• →Wall Street anticipates the Fed will remain hawkish even after potential conflict resolution.
• →Market sentiment may remain negative despite political claims of war completion.
• →The psychological impact on markets could persist beyond the actual end of hostilities.