UBS Economist Predicts Fed Will Cut Rates Aggressively in 2023, Risking Mild 2024 Recession
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The Fed will cut interest rates below 3% by next December, according to UBS chief US economist Jonathan Pingle. This implies over 225 basis points in cuts.
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Pingle expects rate cuts to start in March, followed by more cuts in May, June, and accelerating in the second half of 2023.
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Pingle sees the economy slowing in 2024, sending inflation near 2% and allowing the Fed to cut rates more rapidly.
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He expects a mild recession in 2024 due largely to waning consumer spending momentum.
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Pingle said "we’re going to end up with a relatively soggy 2024" as broader growth declines without consumer spending driving industrial sectors.