AI fatigue takes centre stage as Fed fears ease: Ed Yardeni

Veteran strategist Ed Yardeni said the US Federal Reserve is no longer the primary driver of markets as investors have largely adjusted to higher-for-longer interest rates and are focusing on earnings and broader fundamentals. He noted that recent weakness in semiconductor and technology stocks reflects AI fatigue rather than doubts about the technology itself, leading to selective sector rotation. Yardeni views a US 10-year bond yield of around 4.5 percent as normal and said the labour market remains in balance, suggesting the Fed should prioritise getting inflation down to 2 percent.