PIMCO, a giant in bond funds, states that the Federal Reserve will maintain interest rates unchanged "for the foreseeable future" and may even raise rates.
PIMCO's Chief Investment Officer Ivascyn believes that the Federal Reserve needs to wait for further clarity on Trump's policies and US economic data. Recent consumer surveys have shown a rise in inflation expectations, indicating that the possibility of interest rate hikes "does indeed exist"; he also warned that the current valuation discrepancy between US stocks and bonds is nearing historical extremes, and if hawkish policies drive up US Treasury yields, the stock market may be under pressure simultaneously.
Bank of Japan Resumes Hiking Rates as Economy Strengthens
Trump: Will demand Saudi Arabia and OPEC lower oil prices. The Federal Reserve should quickly cut interest rates.
President Trump of the USA stated on Thursday at the World Economic Forum in Davos that he would ask Saudi Arabia and OPEC to lower oil prices, after which he would "request" a decrease in interest rates.
Trump publicly commented on the Federal Reserve's policy, demanding an immediate cut in interest rates.
President Trump of the USA publicly commented on the Federal Reserve's policy for the first time, calling for a reduction in interest rates.
Trump's policies may limit the Federal Reserve's capacity to lower interest rates in 2025.
After the Federal Reserve cut interest rates by 100 basis points, the market generally believes that future policy easing will depend on further evidence of economic weakness in the USA and a reduction in inflationary pressures. Trump's low tax and loose regulatory policies are expected to promote economic growth, while immigration controls and trade tariffs may pose a risk of price increases, meaning the market may have to wait some time to see the next rate cut from the Federal Reserve. Trump's policies will keep the Federal Reserve in a mildly hawkish stance. At the December FOMC meeting, the Federal Reserve cut rates by 25 basis points as expected. However, at the subsequent press conference, the Federal Reserve stated.
USD Consolidates as Markets Await Tariff News – Scotiabank