Reaction quote on US Fed Reserve announcement (FOMC) by Mr. Subho Moulik, CEO & Founder, Appreciate, a SEBI and IFSCA registered fintech company
Below the Reaction quote on US Fed Reserve announcement (FOMC) by Mr. Subho Moulik, CEO & Founder, Appreciate, a SEBI and IFSCA registered fintech company
"To state that the markets are awaiting a September rate cut with anticipation is to state the obvious. As evidence, consider the fact that the Dow Jones has rallied 400 points as the pathway to September starts materialising concretely. To me, this is a pivotal point that hints at a narrative turnaround, provided no unforeseen economic, geo-political or financial shock appears out of the blue.
There, of course, is the larger, looming risk that the Fed could overplay its hawkish hand. In its zeal to clinch low and stable inflation, it could, possibly, nudge the US economy into recession territory, under the burden of interest rates operating at a 22-year high. However, the US GDP growth rate at 2.1% for the first half of the year signals that there is more than enough resilience in the US economy, and the odds of the US economic activity tipping into negative territory are slim.
Despite the incredible market rally we have witnessed this year, a September rate cut would have a further multiplier effect that will send US benchmarks soaring higher. From here on forth, think of the markets waiting eagerly with their “fingers crossed” till the September Fed meet."
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