Fed’s Pause Impact on US Economy

Luca Santos from ACY, evaluates the current status of the US Federal Reserve's actions and speculates about future potential moves. Luca comments on the recent well-anticipated pause from the Fed, stating that the market didn't react much.

However, he anticipates another pause in December, predicting weak economic data and affirming that higher rates are effective. Whilst discussing the future economic outlook, Luca suggests there is a possibility of avoiding recession until the first quarter of next year. He expresses his concern about numbers being continually revised downwards, indicating an inflated economy.

Despite a popular speculation of a rate cut by May, Luca doesn't expect this to happen until the third or fourth quarter of 2024.When discussing the effect of recent Fed commentary, he mentions Jerome Powell, stating an increase in importance of future speeches about predictions for the economy.

Luca also observes the resilience of the US dollar, with a bullish market expected to continue into the early part of next year. He confirms that he is short selling the Australian dollar against the US dollar and speculates the DXY may rise to 107, and possibly 108, in the future.

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