Despite rising inflation, Piper Sandler Chief Investment Strategist Michael Kantrowitz expects the Fed to cut rates within three months, citing lower tariff rates, a slower pace of rising energy prices, and a resilient consumer.
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Forget margin or options. Here's how the pros trade QQQ“The labor market is really the most important thing,” Kantrowitz told CNBC. “And as long as income continues, which it is, the consumer, again, in aggregate, will be fine.”
Kantrowitz Pushes Back on Weak Consumer Sentiment as Rate Cut Odds Remain Slim
Kantrowitz added that the recent decline in consumer sentiment may be exaggerated, skewed by consumers “ticked off that gasoline prices are higher.” The University of Michigan’s preliminary Index of Consumer Sentiment dropped to an all-time low of 48.2 this month with inflation expectations remaining elevated.
Kantrowitz’s view contrasts with the CME FedWatch tool, which assigns a slim 2.3% chance that the Fed will cut rates by 25 bps by September.