Reported 4 months ago
The Federal Reserve's pivot towards easing has paradoxically made it more challenging for the central bank to lower rates, according to Economist Torsten Sløk. Financial markets have interpreted Chair Jerome Powell's signals incorrectly, expecting imminent rate cuts leading to a massive stock market rally. Sløk notes that the economy remains strong with fiscal stimulus supporting growth, but the expectation of rate cuts creates a paradox where financial conditions ease, making it harder for the Fed to cut rates.
Source: YAHOO