Ben Powell, Chief Middle East & APAC Investment Strategist at the Blackrock Investment Institute believes that the US Federal Reserve doesn’t like to let the market down. “So, if the market is fully expecting a cut next week and if the Fed doesn’t deliver, that would be a shock. Therefore, the Fed will follow through,” he said.
He sees the inflation battle continuing through 2025. It continues to be sticky, and Blackrock Investment Institute believes it is driven by structural forces, and will give the Fed relatively little room to maneuver.
“So next week they are going to cut, but in 2025 probably they can only do maybe two more cuts to get down to 4% and then we think they are going to be stuck because inflation continues to be a bit of a problem, more than they would prefer,” he said.
