"The Fed adjusts their dot plot accordingly, so the dot plot is always changing, and stock traders know this," said Scott Colyer, CEO of Advisors Asset Management. "It's clear that the Fed really wants to cut rates at least once this year. And those rate cuts, even if there is only one, will still be supportive to stock prices."

Gregory Kuhl, portfolio manager at Janus Henderson Investors, said: "The market and the Fed seem to be consolidating around the same view that interest rates are now appropriate, but the Fed still prefers to cut rates as the next move. Based on what we are learning from apartment landlords, we think the housing component of the CPI will continue to put downward pressure on the overall number, which may provide more progress signals from the Fed. Importantly, unlike private real estate, public REITs are already marked to market, so an environment where interest rates remain unchanged or fall should be a tailwind."

Donald Kuhl, senior portfolio manager at Federated Hermes "I think the Fed definitely wants to see at least three or four months of lower inflation," Ellenberger said. "They want to make sure that inflation gets to 2% because the worst-case scenario for the Fed is if they cut rates and inflation goes back up and then they have to reverse the cuts and start raising rates again."

Dave Lutz, director of traded funds at JonesTrading, said: "The dot plot was more hawkish than expected, which took some of the fuss out of today's move, but we need to see how the rest of the press conference is digested. It feels like the Bank of Japan is the only thing left this week, and we may see the VIX pull back and stocks near their highs."

Dan Suzuki, deputy chief investment officer at Richard Bernstein Advisors, said: "Investors need to accept the fact that the Fed is not in charge. They are just responding to inflation, and inflation is responding to economic growth. Until there is a meaningful breakout in growth to the upside or downside, inflation will probably remain stubbornly above the Fed's target, and you are unlikely to see the Fed take any aggressive action."

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