Economist Roubini Warns of Stagflationary Risks as Fed Holds Firm on Rates

Nouriel Roubini, the economist known as 'Dr. Doom' for his prescient warnings ahead of the 2008 financial crisis, predicts Core inflation will remain stubbornly high at 3.5% in the second half of 2024. The Federal Reserve's preferred inflation gauge—the Core PCE index—shows no signs of cooling sufficiently to justify rate cuts before December, potentially leaving the economy vulnerable to a 'mini stagflationary shock.'

Global trade tensions loom as Roubini anticipates a 'mild but damaging' scenario where 15% tariffs become widespread. While he dismisses comparisons to the market crash triggered by Trump's 2025 tariffs, the narrowing path for monetary policy leaves little margin for error. cryptocurrency markets may face volatility as traditional finance grapples with slowing growth amid persistent inflation.