Institution: The Federal Reserve should lower interest rates as soon as possible to avoid falling behind the situation.
MainSky Asset Management Chairman Eckhard Schulte stated that interest rates in the United States are still very restrictive, and he believes the Federal Reserve may not be able to keep up with the situation. "The Fed should cut rates as soon as possible," he said. He noted that although tariffs may lead to inflation, this will be a one-time impact. The Fed may not cut rates in June. "However, this brings a risk that it will lag behind the curve due to its over-reactive approach." This potential policy mistake represents the highest risk to the current US economic downturn. Currently, the money market is pricing in a 25 basis point rate cut by the Fed in September.
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