Former Trump economic adviser: Learning from history, the Fed expects to raise interest rates only after the 2024 election | Fed

Original title: Former Trump economic adviser: Learning from history The Fed does not expect to raise interest rates until after the 2024 election Source: Jiemian News

althoughMidlandChu has always tried to reassure the market sentiment, saying, “QualcommInflation is only temporary”, but with the passage of time, inflation remains high, and the market has to wonder how long “temporary” means, and speculateMidlandThe Reserve Bank will tighten policy ahead of schedule.

However, French foreign tradeBank(Natixis) Joseph LaVorgna, chief economist for the Americas, believes thatMidlandThe Reserve Bank does not expect to raise interest rates until after the 2024 election.Therefore, bond investors who want the Fed to change direction may have to wait a long time.

In an interview, he said, “I guess the Fed will not tighten until the next presidential election.currencypolicy. Looking back at the previous two interest rate hike cycles, the average time from the last interest rate cut to the first interest rate hike was seven years. Therefore, this is actually not uncommon. “

　　As a special assistant and chief economist of the National Economic Council, former President Trump’s adviser on financial markets and economicsLaVorgna said, “After this year’s strong economic expansion, US economic growth will slow down in 2022.interest rateThere is almost no pressure to act. “

“I think the growth rate for next year is only 2% or even lower. Inflation will be temporary. This is what the market tells us.” He added. With the reopening of the economy and Americans spending again after a year of blockade, consumer prices are rising at the fastest rate since 2008.

But even so, the yield on the U.S. benchmark 10-year Treasury note continued to fall, dropping to 1.18% on Tuesday.Last week, U.S. officials set the benchmarkinterest rateMaintained in the range of zero to 0.25%, the Fed’s June forecast shows that low interest rates will remain until 2022.

In addition to raising interest rates, another big question the Fed faces is when to reduce or cancel its $120 billion monthly asset purchase plan, which is a tool to provide liquidity to financial markets during the new crown epidemic. Although some economists expect the Fed to take action as early as next month, LaVorgna said,He expects the Fed to take a more cautious approach.

　　“In an environment of slowing economic growth, it is really difficult for the Fed to reduce the scale of bond purchases.”He added.

Editor in charge: Guo Jian