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According to Bill Ackman, the Economy is Starting to Sluggish Down and the Fed is Probably Done Raising Rates

The economy, according to Bill Ackman of Pershing Square, has started to slow down as a result of aggressive rate hikes, he warned on Monday.

“I believe the Fed has served its purpose. Ackman stated on CNBC’s “Squawk Box” that he believed the economy was beginning to slow down. “I believe real interest rates are reaching a level where they will slow things down.”

The Federal Reserve raised interest rates to their highest level since 2006 in an effort to combat persistently rising inflation, and they are expected to stay there for a longer period of time. The central bank anticipated raising rates once more this year. As the economy experiences the lag effects of significant tightening measures, there is growing concern on Wall Street about a possible recession.

High credit card and mortgage rates are beginning to have a significant influence on the economy, according to Ackman. Although the economy is still strong, it is undoubtedly deteriorating. There are numerous signs that the economy is deteriorating.

Long-term Treasury yields may rise even further in the current environment, according to the billionaire hedge fund manager. He predicts that the benchmark 10% rate will soon reach 5% and that the 30-year rate will test the mid-5%.

Ackman predicted that the 30-year Treasury would rise. Because the economy is showing signs of weakening, I don’t think the 10-year rate needs to rise significantly above 5%. Nevertheless, over the long haul. We believe that in such an environment, structural inflation will continue to be greater.

Source (CNBC)

SourceCNBC
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