It's Not Time to Raise Rates, Says State Street's Hung

Summary

State Street Investment Management CEO Yie-Hsin Hung argues money market funds have become a durable asset class amid elevated yields. She highlights private credit’s attractiveness due to floating rates, and says the firm is overweight US and emerging market equities on strong corporate earnings. The Fed should hold rates steady this year, with investor sentiment mostly optimistic despite valuation and debt concerns.

• Money market funds are viewed as a durable asset class with strong inflows.
• Private credit benefits from floating-rate exposure in the current environment.
• State Street overweight equities, favoring US first and emerging markets second.
• Fed expected to keep rates on hold this year; US economy remains robust but labor market a concern.
• Gold, commodities, and private markets serve as portfolio anchors in a barbell strategy.
• AI adoption is early-stage, offering efficiency and revenue opportunities, but not a headcount reduction play.
• Investor sentiment is optimistic overall, driven by strong fundamentals, though valuation and financing worries persist.