Talking about substantial number of rate cuts is ‘premature,’ Torsten Slok says

Apollo’s Torsten Slok still thinks that discussion around more interest rate cuts in the future is “premature” following Friday’s PCE report.

“At the end of the day, if the strength of the economy is still running the risk here that we might get another … flare up or more tailwinds to the economic outlook, then I do think it’s premature to take out the champagne bottle and begin to talk about a dramatic amount of rate cuts coming,” the firm’s chief economist said.

Slok said that while the Federal Reserve may make a cut in September, there needs to be more progress on inflation. He added that he doesn’t believe some weakness in certain labor market indicators justifies the pricing of three cuts this year.

“I still think that the economy is doing quite well,” he continued.