But this time was different, or at least it has been so far. The economy is still growing, the unemployment rate remains remarkably low and optimism is on the upswing among U.S. households.

“I don’t think this cycle is normal at all,” said Niladri “Neel” Mukherjee, chief investment officer of TIAA’s Wealth Management team. “It’s unique, and the pandemic introduced that element of uniqueness.”

After shooting higher as snarled supply chains caused shortages because of COVID-19 shutdowns, inflation has been cooling since its peak two summers ago. It’s eased so much that Wall Street’s biggest question now is when the Federal Reserve will begin moving interest rates lower.

Such cuts to rates can act like steroids for financial markets, while releasing pressure that’s built up on the economy and the financial system.

Treasury yields have already relaxed significantly on expectations for rate cuts, and that helped the stock market’s rally accelerate sharply in November. The yield on the 10-year Treasury slipped Friday to 4.13%, and it’s down sharply from the 5% that it reached in October, which was its highest level since 2007.

Of course, some critics say Wall Street has gotten ahead of itself, again, in predicting how soon the Federal Reserve may begin cutting interest rates.

“The market is addicted to rate cuts,” said Rich Weiss, chief investment officer of multi-asset strategies at American Century Investments. “They just can’t get enough of it and are myopically focused on it.”

Repeatedly since the Fed began this rate-hiking campaign early in 2022, traders have been quick to forecast an approaching easing of rates, only to be disappointed as high inflation proved to be more stubborn than expected. If that happens again, the big moves higher for stocks and lower for bond yields may need to revert.

This time around, though, the Fed itself has hinted that rate cuts are coming, though some officials have indicated they may begin later than the market is hoping for. Traders are betting on a nearly coin flip’s chance that the Fed will start cutting in March, according to data from CME Group.

“The truth is likely somewhere between what the Fed is saying and what the market is expecting,” said Brian Jacobsen, chief economist at Annex Wealth Management. “That will continue to cause dips and rips” for financial markets “until the two reconcile with each other.”

Some encouraging data came Friday after a preliminary report from the University of Michigan suggested the mood among U.S. consumers is roaring higher. It said sentiment jumped to its highest level since July 2021. That’s important because spending by consumers is the main driver of the economy.

Perhaps more importantly for the Fed, expectations for upcoming inflation among households also seem to be anchored. A big worry has been that such expectations could take off and trigger a vicious cycle that keeps inflation high.

Friday’s lift for Wall Street came with a big boost from technology stocks, something that’s become typical in its run higher.