Economist: Caution is needed when betting on Fed rate cuts

ChainCatcher news, renowned Federal Reserve watcher and Chief Economist at Nationwide, Cathy Bostianchich, warns that caution is needed regarding bets on Federal Reserve rate cuts.

She believes that investors are too eager to digest the impact of rate cuts, as concerns about a sharp economic slowdown grow, and they generally expect the Fed's protective policies (Fed put) to provide a buffer for economic activity. Even assuming that economic activity does not decline sharply, high persistent inflation, along with inflationary pressures from tariffs, may keep the Federal Reserve on the sidelines for a longer period than the market expects.