deVere Group CEO Nigel Green predicts that the US Federal Reserve (Fed) will cut rates after the country's price growth slowing in February.
However, he notes that the US inflation direction is not straightforward. The cost of services is declining, but the rise in wages exceeds forecasts. In addition, growth rate in key sectors is weakening, while inflation expectations have been increasing in recent weeks.
In Green’s opinion, the US administration’s tariff policy can result in rising consumer prices and slowing GDP growth. This combination can put the Fed in a difficult position, de Verde CEO says.
He believes an early cut in the cost of borrowing will help avoid further damage to the US economy. As stated by the country’s regulator, decisions on interest rates will be based on incoming data. At the same time, according to Green, it is now obvious that the US inflation is decelerating, the economy is weakening, and the risks of inaction outweigh the risks of premature monetary policy easing by the Fed.