Call 800 665 0411 to learn about our services for your stock

Search   Follow Investorideas on Twitter   Investorideas is on Facebook   Investorideas is on Youtube   Investorideas is on Pinterest  Investorideas is on stocktwits   Investorideas is on tumblr   Investorideas is on LinkedIn   Investorideas Instagram   Investorideas Telegram   Investorideas Gettr   Investorideas RSS

Share on StockTwits

Fed will lose public and market confidence with more rate rises

August 31, 2023 ( Newswire) The US Federal Reserve will "lose the confidence of the public and financial markets" and have "disastrous" economic effects, if it continues raising rates any further, warns the CEO and founder of one of the world's largest independent financial advisory, asset management and fintech organizations.

The stark warning from deVere Group's Nigel Green comes ahead of the Personal Consumption Expenditures index, which comes out Thursday at 8:30 am EST.

The PCE price index measures changes in the prices paid by consumers for goods and services over time. It's one of the key indicators used by the US central bank and other economic analysts to assess inflation trends and make monetary policy decisions.

The deVere CEO comments: "The PCE is being keenly watched as investors were cheered earlier in the week by the weaker-than-expected payrolls data and annual gross domestic product growth forecast - both of which strongly make the case that the Federal Reserve must now stop its most aggressive tightening campaign in decades."

He continues: "The Fed's battles against inflation, growth and jobs are being won.

"There are now genuine concerns that unless the Fed drops raising rates, it will drive the US economy into a major recession.

"As the world's largest and most influential economy, this would potentially have disastrous global implications."

Nigel Green also stresses that not only must the Federal Reserve abandon its tightening program because the program has been effective, but it must also do so because inflation is likely to fall quicker than many anticipate for three reasons.

"First, there's unlikely to be a wage price spiral as real wages are typically going down despite the increases. Employers now seem to be holding back from increasing salaries on demand, which will help stifle wage inflation.

"Second, the time lag for monetary policies is incredibly lengthy. It takes around 18 months for the full effect of rate hikes to make their way into the economy - and that's where we are - and so financial conditions will get squeezed even harder in the near term.

"And third, although many economies are now likely to avoid a full-blown recession, economic growth is still expected to be weak for the foreseeable future."

He concludes: "If the Fed does not stop its rate hiking agenda, it will lose the confidence of the public and financial markets which would have serious, far-reaching negative consequences for the US and the world."

t: +44 207 1220 925
Twitter: @PriorConsults

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients. It has a network of offices across the world, over 80,000 clients and $12bn under advisement.

More Info: Newswire

This news is published on the Newswire - a global digital news source for investors and business leaders

Disclaimer/Disclosure: is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investing involves risk and possible losses. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. Contact management and IR of each company directly regarding specific questions.

More disclaimer info: Learn more about publishing your news release and our other news services on the newswire

Global investors must adhere to regulations of each country. Please read privacy policy:

That's all it takes to get an article published on Investor Ideas - Learn More