Through March and April, we discussed how indices were priced for perfection on the interest rate front. Now, as reality sets in, we consider if/when and how we should consider fading this “less dovish” outlook for US rate cuts. Just like squeezing an orange, removing the last 10% of the juice is far more complex than the first 10%, and this is the case for inflation, which has been demonstrated perfectly over recent months. However, arguably the biggest issue for the Fed and other central banks is the inflationary implications of an elevated oil price courtesy of the tensions in the Middle East, an issue well beyond the influence of Jerome Powell et al. The mantra of “higher for longer” concerning rates feels on point at the moment, which has been the subsequent cause of April's weakness in equities.