Is the Fed on hold for now? June rate cut no longer in view?
With almost every US data point from jobs to manufacturing and commodities prices showing upward price pressures remain, should there be an interest rate hike instead of a cut?
Tematica CIO Chris Versace says he thinks the Fed can sit and wait on rates for now, without having to cut until the risk of rising inflation has truly eased.
(AI Video Summary)
Discussing hotter-than-expected US CPI number
In this interview, Chris Versace, CIO at Tematica, analyses the unexpected rise in US CPI, emphasising its long-term impact driven by soaring commodity prices, particularly oil. Versace argues that these inflationary pressures, spotlighted by recent data from PMI reports, wage increases, and specific legislative changes, are unlikely to recede soon.
Fed rate cuts
The conversation shifts to the Federal Reserve's potential policy response, suggesting that anticipated June rate cuts might not materialise as inflation remains persistent. Additionally, the dialogue touches on Apple's strategic moves to diversify its supply chain beyond China to mitigate geopolitical and pandemic-induced risks, highlighting its gradual shift towards manufacturing in India and Vietnam. The interview concludes with insights on the upcoming earnings season, with a keen focus on the banking sector and its implications for the broader market.
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