Steve Forbes, Chairman of Forbes Media, has suggested that the Federal Reserve is unlikely to raise interest rates in the near future but also unlikely to cut rates, given the mixed economic data in the United States. He pointed to contradictory indicators, such as a weakening labor market but a relatively strong services sector report. Forbes believes this mixed economic picture will give the Federal Reserve a reason to maintain its current stance.
The Federal Open Market Committee is set to meet in September, with a 92% probability that rates will remain unchanged, according to the CME’s FedWatch tool. However, the probability of a rate hike increases to 38.4% after the November meeting.
Forbes also commented on the possibility of a government shutdown, suggesting that there is a looming risk. Funding for the federal government is set to expire at the end of the month unless Congress takes action. Forbes expects Washington to wait until the last minute before reaching a deal but cautioned that the repeated brinkmanship could lead to a government shutdown.
Looking ahead to the 2024 elections, Forbes anticipates that the economy will be a central issue, with other important topics including crime and foreign policy, particularly the United States’ global standing and its approach to Ukraine.
In summary, Steve Forbes believes the Federal Reserve will likely maintain its current interest rate stance due to mixed economic data, and he sees potential risks of a government shutdown as funding deadlines approach. He also expects the economy to be a key issue in the 2024 elections.
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