The US Federal Reserve won’t be swayed and will raise interest rates this month despite inflation coming in cooler than expected, says the CEO and founder of one of the world’s largest independent financial advisory, asset management and fintech organizations.
Nigel Green of deVere Group’s warning comes as the latest US CPI comes in lighter than economists predicted.
He says: “Despite the data showing that the battle against inflation in the world’s largest economy is being won, we expect the Federal Reserve will resume its interest rate hiking agenda this month.
“The central banks’ officials will argue that there is still work to be done to tame inflation, and they are unlikely to be dissuaded from their course of action for the time being.
“While we believe that the Fed will raise rates in July, there is now less justification for further hikes later this year.”
The deVere CEO is urging the US central bank not to raise interest rates past July.
“Investors are increasingly concerned that the Federal Reserve could with further hikes overtighten and that would steer the US economy into a major recession.
“The central bank must also ensure the broader picture is maintained and not be too cautious by overdoing the hikes, which would trigger the US recession deeper and longer.
“As the world’s largest economy, this would clearly have a serious, negative impact on the global economy.
“The most aggressive tightening campaign in decades is not quite finished – but the tide could be turning.
“Against this backdrop, a good fund manager will help you pick out the winners and losers to help you sidestep the risks to your wealth and seize the opportunities to build it for the long-term.”