The Fed Will Not Raise Interest Rates Next Year? The Situation Is Complicated And Confusing.

After Wall Street questioned the Fed's interest rate increase during the year, chief economist Joseph LaVorgna of Deutsche Bank said today that the Fed may not raise interest rates next year.

Prior to LaVorgna, the Federal Reserve is expected to raise its first interest rate increase in more than nine years in March next year, and will raise interest rates again in June, and then suspend interest rate hikes, because the market needs some time to assess the impact of interest rate hikes.

But in a report on Monday, he pointed out that the Federal Reserve may delay the increase in interest rates. "Considering that the US economy and labor market were strong earlier this year, the Fed had ample opportunity to raise interest rates.

It's unlikely. "

Chairman Yellen has said that interest rates may increase during the year, but the Fed abandoned interest rate hike in September, which means that the final interest rate increase this year can only be in the next week or December interest conference, and many economists believe that the possibility of raising interest rates in December is greater.

The Federal Reserve Chairman and the two directors openly expressed different opinions, which was confusing.

It is even more impenetrable, which undermines the credibility of the US central bank.

As Fed chairman Taruno and Renard spoke last week, the Fed's internal opinion split became more obvious because of worries about the economy and not supporting interest rates during the year.

Yellen and Dudley, chairman of the New York fed, said that interest rates were expected to increase during the year, depending on the performance of economic data.

Dudley reiterated his view last week, but at the same time said that economic data had deteriorated.

Barclays Bank also believes that the Federal Reserve will raise interest rates in March next year, but Goldman Sachs, Merrill Lynch and JP Morgan believe that the Federal Reserve will raise interest rates in December this year.

LaVorgna said the slowdown in global economic growth and its uncertain potential impact on the United States may delay the Federal Reserve's interest rate hike, but he also points out that political factors will intervene.

"I think the Fed will become a hot topic next year, if they still do not raise interest rates.

If we do not raise interest rates by June next year, unless the economy is overheated, the Fed may choose to raise interest rates before the November election. "

He said.