Neuberger Berman: Fed's terminal rate below 3% is appropriately priced

Ashok Bhatia, co-chief investment officer of fixed income at Neuberger Berman, said that the current Fed terminal rate pricing of 2.9% is appropriate. "The market's expected terminal rate of less than 3% would be equivalent to a real interest rate of about 1% (assuming the Fed can and will restore inflation to about 2%), which is basically the neutral interest rate." Although the economy may eventually need loose or lower real interest rates, this will be a long-term problem. (Jinshi)