Inflation has moderated but remains above target, while the labour market is cooling gradually rather than deteriorating sharply. That combination gives the Fed room to stay patient instead of rushing to either hike or cut. I will be watching core PCE and non-farm payrolls most closely. If core inflation keeps easing without a sharp rise in unemployment, rate-cut expectations could return later, but not until there is stronger evidence. Higher-for-longer rates would continue to favour quality financials and cash-generative companies, while highly valued, rate-sensitive growth stocks and heavily leveraged sectors could remain under pressure.