Fed’s Hammack Drops Bombshell: ‘No Clear Case for Rate Cuts’ as Inflation Stays Stubbornly High
Another day, another Fed official pouring cold water on Wall Street's rate-cut fantasies.
Hammack's blunt assessment cuts through the noise: inflation's still running hot, and the Fed isn't about to blink. Traders betting on easy money might want to check those leveraged positions.
Funny how 'transitory' inflation keeps getting... extended. Maybe Powell should've minted that as an NFT.
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“After last week’s meeting, I see monetary policy as barely restrictive, if at all, and it’s not obvious to me that monetary policy should do more at this time,” said Hammack in prepared remarks for an Economic Club of New York event.
Hammack Expects Higher Inflation as Fed Considers Next Move
Hammack said that she opposed last week’s 25 bps rate cut to the 3.75%-4.00% range, reasoning that inflation remains above the Fed’s inflation target of 2%. In addition, she expects higher unemployment during the next few months and inflation to return to 3%, despite “accommodative” financial conditions.
A 25 bps rate cut next month is the likely outcome with 70.9% odds, according to CME’s FedWatch tool. The odds received a boost on Thursday after Challenger, Gray & Christmas reported 153,074 job cuts in October, the highest number for the month since 2003.
