UBS Analyst Forecasts Number of Rate Cuts for Remainder of Year, Contradicting FED’s Announcements
In a recent statement, Nadia Lovell, senior US stock strategist at UBS, provided an evaluation of the US economy. Lovell’s analysis contradicts the announcements made by the Federal Reserve (FED).
During an appearance on CNBC’s ‘Squawk Box’, UBS senior US equity strategist Nadia Lovell discussed the latest market trends and the factors that could drive the market higher.
Looking ahead to the second half of the year, Lovell predicts that the market will continue to trend upward, although not at the same rate as the impressive 14% growth seen in the first half. Lovell emphasizes the importance of the upcoming earnings report season in propelling the market higher, especially considering the current stretched valuations.
Interestingly, Lovell’s market outlook is based on the expectation of two rate cuts this year, with the first one taking place in September. However, Lovell clarifies that these reductions are not necessary for the market to rise, as demonstrated by its performance in the first half of the year. Lovell believes that earnings reports will be the primary driver of market growth.
In terms of potential impacts on companies and inflation, Lovell highlights former President Trump’s proposed 10% general tariff and 60% tariff on imports from China. While certain industries that face strong competition from China may benefit from these tariffs, they could pose challenges for companies with supply chains abroad.
The next meeting of the Federal Open Market Committee (FOMC) is scheduled for July 30-31, 2024.
*Please note that this article does not constitute investment advice.
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