On April 10, the "Doomsday Doctor" Nouriel Roubini issued a new warning to Wall Street: traders should reduce their bets that the Federal Reserve will significantly cut interest rates to mitigate the impact of President Trump's trade war.
Roubini, a famous economist known for accurately predicting the global financial crisis, believes that the United States will avoid a recession, and the Federal Reserve will keep interest rates unchanged for the rest of the year after trade policy disputes ease. "This is certainly a head-to-head confrontation between Trump and Powell," Roubini said, "but what I want to say is that Powell's strike price will be lower than Trump's, which means Powell will wait for Trump to blink first."
Federal Reserve Chairman Powell stated last week that the economic impact of new tariffs could be far beyond expectations, and the central bank must ensure that this does not trigger a more serious inflation problem. This week, traders have digested expectations of the Federal Reserve cutting interest rates three to five times by 25 basis points each, with some on Wall Street even believing that the central bank might urgently lower interest rates before the next meeting. (Jinshi)
