Analyst: Tariff Inflation May Continue to Feed Through to Economy in Coming Months, Fed Seen Cutting Rates Twice This Year

BlockBeats News, February 14th, Stephen Douglass of NISA Investment Advisors stated that about one-third of the inflation related to tariffs may still gradually transmit to the economy in the coming months.

This is expected to keep the economy performing well and keep the Federal Reserve on hold for a while. "We are back on track to achieve a soft landing," he said. "The labor market will stabilize, and the final ripples of tariff inflation will transmit in the first half of this year."

He expects that commodity inflation will drop below zero in the second half of the year, creating room for the Federal Reserve to resume rate cuts later than the market expects. "Our view for this year is to cut rates once in September and once in December." (FXStreet)