JPMorgan's Yoder: Markets Are Doing the Fed's Work

Abby Yoder, a U.S. equity strategist at J.P. Morgan Private Bank, said the market is carrying much of the work that would otherwise fall to the Federal Reserve. Her remark points to the way asset prices and borrowing costs can shift financial conditions well before policymakers make a move, giving investors an early read on the direction of policy.

Yoder made the comment during an appearance on CNBC's Closing Bell, where she was joined by Cameron Dawson, chief investment officer at Newedge Wealth. The two discussed the latest developments in the markets and what those moves may signal for the months ahead.

The notion that markets can do the Fed's work is a familiar theme on Wall Street. When stocks, bonds and credit spreads move sharply, the resulting change in financial conditions can influence lending, spending and investment, potentially easing the pressure on central bankers to adjust policy themselves.

For investors, the takeaway is that market moves can serve as a policy signal in their own right. Strategists generally counsel watching how prices, yields and expectations evolve together, since those forces help shape the backdrop the Fed confronts at its next meeting.