Vanguard Utilities ETF Up 14.96% Yearly as June Fed Cut Odds Hit 70%
Vanguard Utilities ETF has gained 14.96% in the past year and 1.61% last month, yields 2.51% annually, and holds a Zacks ETF Rank #2. Fed funds futures imply a 70% probability of a June rate cut and an 80.4% chance by July, potentially lowering financing costs for utilities.
1. Performance Metrics
Vanguard Utilities ETF has delivered a 14.96% total return over the past year and a 1.61% gain in the last month, outperforming peer funds in the utilities sector. These returns reflect strong demand for defensive, dividend-paying assets during volatile market conditions.
2. Dividend Yield and Ranking
VPU offers a 2.51% annual dividend yield, making it one of the highest-yielding broad U.S. utilities ETFs. The fund’s Zacks ETF Rank #2 indicates a Buy rating, underpinned by its cost-effectiveness and sector exposure.
3. Fed Rate Cut Outlook
Federal funds futures now price in a 70% chance of a rate cut by June and an 80.4% chance by July 2026. Lower interest rates could reduce borrowing costs for capital-intensive utility companies, enhancing VPU’s potential performance.