Markets read Fed’s June policy outcome as a hawkish pause, with the Dot plot projecting 50bps hike yet more to come before the end of this calendar year. However, with Consumer and producer inflation falling sharply in US, we do not see Fed rate going to 5.75%. We sense that Fed could probably deliver one more 25bps hike in July and that would be the terminal rate (5.5%). One cannot ignore emerging signals of slowing aggregate demand in US which will likely manifest clearly in Q3 and Q4, which will infact prompt Fed to undo to process of monetary tightening during early 2024.