The outlook for Federal Reserve rate cuts continues to change, with markets repricing their expectations from six cuts in 2024 to now hoping for just one. JP Morgan Private Bank Global Investment Strategist Elyse Ausenbaugh, joins Catalysts to share her insights on the Fed’s trajectory.
Ausenbaugh expresses optimism about the path of shelter inflation, expecting it "to continue to come down." She also highlights the importance of the labor market, describing it as having "a really robust foundation." The combination of these two factors, she suggests, points to the economy’s ability to "get over this final hump of inflation," potentially allowing the Federal Reserve to feel comfortable cutting rates in the near-term.
Ausenbaugh identifies the Fed as the "driver" of investor sentiment, emphasizing how the S&P 500 (^GSPC) rallied after markets readjusted their expectations for rate cuts. "We are watching every single data print, all of the inflation data to continue to monitor and recheck the outlook that we put forward that the Fed will cut interest rates one time by year-end," Ausenbaugh tells Yahoo Finance.
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