Deutsche Bundesbank: US economic data do not support the Federal Reserve's substantial interest rate cuts
Publication Time:2024-09-13 20:26:08
In a report, Birgit Henseler, an analyst at Deutsche Bundesbank, stressed that despite differing expectations in the market regarding the magnitude of the first interest rate cut by the Federal Reserve, the current economic data, particularly those on the labor market and inflation rates, do not indicate a need for aggressive monetary easing policies. Henseler pointed out that the steady growth trend in the labor market contrasts with signs of recession, suggesting that the economy is currently experiencing a mild slowdown rather than a deep recession. Moreover, the latest data on core inflation show a stronger than expected growth trend, mainly due to rising housing costs and other service fees. These factors collectively support Henseler's view that the Federal Reserve should opt for more cautious monetary policy actions, avoiding excessive intervention that may bring uncertainty.
Federal Reserve
US Economy
Interest Rate Cuts
labor market
core inflation