Dr Dirk Schumacher – Chief Economist of KfW

"The available data and comments from members of the Fed's monetary policy committee make an interest rate cut next week highly likely. While the shutdown of many federal agencies and the resulting delays in the release of key data mean the US central bank is operating more in the dark than usual, the apparent relative weakness of the labour market and the overall moderate effect of the tariff increases on inflation will nevertheless lead to a clear majority in favor of an interest rate cut at the December meeting. There is considerably greater uncertainty regarding the Fed's next steps. We expect a pause in interest rate cuts initially. Firstly, we do not anticipate a significant slowdown in growth. Secondly, the Fed will need more time to assess whether there will ultimately be a delayed effect of the tariffs on inflation."

Dr Dirk Schumacher