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The Federal Reserve needs to be cautious, as Trump's tariff policy may cause a "permanent shock" to the CPI!
BNP Paribas stated that Trump will implement his tariff policy, and the Federal Reserve's inaction along with a stronger dollar is expected to suppress Gold prices in the second half of 2025.
The backlash effect of Trump's tariffs: By 2027, the USA's GDP may decrease by 1.1%.
According to Nikkei Chinese, on December 13, there are views that the tariff policy proposed by the incoming U.S. President Trump will lead to a slowdown in the U.S. economy. Trump plans to impose a 25% tariff on major importing countries Mexico and Canada, which will result in rising prices and job losses, and by 2027, the U.S. GDP will be reduced by 1.1%. The world's largest economy will lose the benefits of free trade.
China International Capital Corporation: USA inflation may drive "hawkish interest rate cuts".
Next week, a "hawkish rate cut" may take place, as the Federal Reserve might reduce guidance on rate cuts in the dot plot.
Forex Today: ECB and SNB Rate Decision, US Data to Keep Action Going
The Federal Reserve will only cut interest rates two more times! Rabobank: There is evidence that the decline in inflation is stagnating...
According to the outlook of the Dutch Cooperative Banks, the Federal Reserve will only cut interest rates two more times, and the easing cycle will end after January next year, as there is evidence that the decline in inflation is stalling.
The neutral interest rate of the Federal Reserve remains a mystery, and Wall Street is betting on a serious division.
Wall Street's views on whether the Federal Reserve's easing cycle has just begun or is nearing its end are vastly different. If the determination of the neutral interest rate is incorrect, they will suffer heavy losses.