1404 ET - For now, the Fed is likely to look through inflation spikes while monitoring for potentially slower growth, making a prolonged hold on interest rates more likely than a hike, Touchstone's Erik Aarts says. Since the war in Iran began nearly a month ago, futures markets have been increasing bets on a rate rise this year. "Our view is slightly different," Aarts says. "The likely outcome here is demand destruction and slower growth." It could change if core inflation starts to rise. Given the uncertainty, Aarts has shifted asset allocation slightly from neutral to overweight duration, moving the target to 5 years from 4.5 years, while maintaining exposure to the seven-to-ten year range. (paulo.trevisani@wsj.com; @ptrevisani)

(END) Dow Jones Newswires

March 26, 2026 14:04 ET (18:04 GMT)

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