Fed: Is the market demanding rate cuts amid volatility?

Yahoo Finance Video and Josh Lipton

Wed, February 18, 2026 at 10:00 PM GMT+9

Emerald Advisers deputy CIO and portfolio manager David Volpe comments on whether the equity market (^DJI, ^IXIC, ^GSPC) is demanding interest rate cuts by the Federal Reserve or not.

To watch more expert insights and analysis on the latest market action, check out more Market Domination.

Video Transcript

00:00 Josh

I’m just curious how the Fed sort of fits into your narrative there. What’s the story, what’s your base case for cuts in in 2026, David? Does the market need cuts in your opinion to move higher?

00:08 David

Josh, I don’t think it really needs cuts. I think you’ll see a couple of cuts, two, maybe three. But let’s be honest, you go into May, you get the confirmation. If the ceremony re-worsens confirmed,

00:15 David

it always happens. There’s a test of that new chairman. So, I would expect that to be the case and um that’s going to create a lot of volatility. Uh but it could be a different type of Fed obviously.

00:22 David

Uh but that should be beneficial to the market and I think the market will see through it. I think they see they wanted an independent a nominee. I think that’s what they’ve got.

00:28 David

And so I see the Fed as certainly not uh an entity that’s going to constrain uh the market uh and something the market can kind of look through and look towards that earnings growth.

00:34 David

Earnings growth based on productivity, based on just the overall strength of the economy, based on deregulation. Uh I can go on and on in terms of why that earnings growth and the economy should do so well.

00:43 David

And I think they’ll see a lot through the Fed, um, in terms of that.

00:46 Josh

David, great to have you on the show. Thank you.

00:50 David

Thank you, Josh.

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