Steve Forbes doesn’t expect the Federal Reserve to raise rates at upcoming meetings, but the Forbes Media chairman doesn’t see any cuts in the near term either.
“I don’t think the Federal Reserve will raise rates in the coming months. I think they will pause,” Forbes said, citing the slew of contradictory U.S. economic data.
‘Some things are weakening, the labor market is usually a lagging indicator. But the services [sector] The report was quite good,” he told CNBC’s Chery Kang on the sidelines of the Forbes Global CEO Conference in Singapore.
“So they give that mixed picture [an] excuse to finally do nothing,” he said.
The next meeting of the Federal Open Market Committee is scheduled for September 19-20. There is a 92% chance that the central bank will leave rates unchanged after the September meeting, according to the CME’s FedWatch tool. But those odds shift to a 38.4% chance of an increase after the November meeting.
The Fed began its aggressive rate hike campaign in March 2022 as inflation rose to a 40-year high.
About the government shutdown and elections
When asked if the US is facing a possible government shutdown, Forbes said he thinks one is looming.
Funding for the federal government will run out at the end of this month unless Congress takes action. Failure to pass the spending legislation would result in a shutdown on September 30.
Forbes said Washington will go “to the deadline” before coming up with a deal.
“But the danger of these things, [when] We keep getting close to the cliff, otherwise you might slip and go over the cliff. You might get a government shutdown,” he said.
Forbes also said he expects the 2024 election to be about the “pocketbook,” with the state of the economy being “issue No. 1.”
Other issues will include crime and foreign policy, such as Washington’s position on the world stage and its approach to Ukraine.