A top executive at Deutsche Bank AG has stated that the market's anticipation of further interest rate increases from the Federal Reserve is excessive.
Ozan Tarman, Global Vice Chairman of Macro at Deutsche Bank, asserted that the Fed's next policy move will not be a rate hike.
Tarman commented on Monday that the newly appointed Fed Chair, Kevin Warsh, will likely attempt to "persuade his colleagues to hold steady." He added, "The current excitement and speculation that he might completely shift the stance and even convince Trump to push for a significant rate hike this year seems a bit overdone to me."
Regarding the Bank of England, Tarman suggested that the most favorable scenario for Governor Andrew Bailey would be to keep interest rates unchanged at the upcoming meeting.
"The best course of action is to adopt a wait-and-see approach, allowing the political dynamics in the US, the Strait of Hormuz, and even the UK to unfold," Tarman explained.
Tarman also noted that a rate hike by the European Central Bank in June appears almost certain. However, whether President Christine Lagarde will implement another increase in September will depend on the progress of peace negotiations in the Middle East.
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