On June 12, the Fed will hold a new meeting to discuss what they will do with interest rates. The specter of a rate hike reared its head at the May meeting, however, Federated Hermes is clear that: ““Despite the warnings from the May meeting, we do not anticipate a Fed rate hike.”
In this sense, Deborah A. Cunningham, Chief Investment Officer of Global Liquidity, Federated Hermes, ensures that the three-quarter point cuts that the Federal Reserve once planned for the second half of this year are postponed. “Now we expect only one or two to occur,” he says.
Furthermore, he explains that one thing to keep in mind is that the idea that the Fed will avoid cutting rates in September so as not to appear to interfere with the general election, giving up on rate action when the data justifies it, could also seem be politically motivated. “The argument works both ways,” he says..
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