Fidelity’s Jurrien Timmer on why the Fed should be taking back its rate cuts
Jurrien draws a line between the first cuts and what followed. Easing off restrictive policy made sense once inflation had come down. The later cuts are where he takes issue, describing them as gratuitous, driven partly by concern that AI would start eating into jobs while inflation data still looked cooperative. Measured against the Taylor rule, which weighs growth against inflation, those cuts don’t hold up, and the rule has since moved in the opposite direction. The logical response would be to reverse them. His closing observation is the realistic one, that nobody wants to be the person who does that, and Warsh presumably isn’t eager for a call from the White House.
#Macro #FederalReserve #Rates #Inflation #Markets
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