Bank of America forecasts that the Federal Reserve will maintain interest rates through 2026, no rate cuts in 2025.
This call from BoA is reitrating the same from last week, but its getting attention again.
Main points the analysts make:
- The higher rates for longer may tighten financial conditions, reducing liquidity and pressuring asset prices, including equities and cryptocurrencies.
- A stronger U.S. dollar could result from sustained high rates, making riskier assets like cryptocurrencies less attractive to investors.
- Elevated borrowing costs may slow consumer spending and business investments, increasing recession risks.
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The market will view the potential for rate cuts remaining off the table.:
- for stocks, defensive industriess could gain favor, while rate-sensitive sectors face challenges
Note, BoA are a bit on their ownsome with this call. Earlier:
Chair Powell preparing for a BIG cut?
About the caption …. it seems to be a permanent thing and the tech gremlins won;lt let me removes it. No big cut on the horizon, but its a good pic!