Fed May Be Forced Into Action, Top Strategist Warns
Sam Stovall, Chief Investment Strategist at CFRA Research, believes the Federal Reserve will deliver two rate cuts this year as inflation lingers and growth slows.
Speaking on CNBC’s The Exchange, Stovall said investors are waiting for Fed Chair Jerome Powell’s remarks at Jackson Hole, but the backdrop remains challenging.
Inflation, he noted, is still “sticky,” while signs of a weaker labor market are emerging.
Stovall projects annual core PCE inflation will stay above 3% in 2025, leaving the Fed with limited room to maneuver. He sees a possible rate cut in September, no action in October, and a second cut in December.
According to him, these moves would offer modest stimulus without reigniting inflation.
Weak Confidence and Slowing Growth
The strategist pointed to housing as a key gauge, noting that builder confidence has dropped to its lowest level since 2022. Consumer confidence remains subdued as well, reinforcing the need for policy adjustments aimed at stabilizing the next 12–18 months.
Stovall added that tariffs continue to weigh on growth, with U.S. GDP likely slowing to around 1.8–1.9% in the third and fourth quarters. He expects a modest recovery to 2% growth in 2026.
The information provided in this article is for informational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alexander Zdravkov is a person who always looks for the logic behind things. He has more than 3 years of experience in the crypto space, where he skillfully identifies new trends in the world of digital currencies. Whether providing in-depth analysis or daily reports on all topics, his deep understanding and enthusiasm for what he does make him a valuable member of the team.
