Bank of America CEO: Not expecting Fed rate cut this year
The Federal Reserve is hinting that a possible rate cut could be coming by the end of the year, while traders are betting on the possibility of two.
But Bank of America CEO Brian Moynihan told FOX Business’ Maria Bartiromo that he doesn’t see it happening, despite the Fed futures prediction cuts suggesting there’s a 95 percent probability for least one rate cut in 2019.
“I don’t think they will unless something goes really wrong in the trade, I think the economy is stronger than people think,” Moynihan said during a discussion at the Economic Club of New York on Tuesday.
Fed Chair Jerome Powell said the central bank is watching how trade disputes between the U.S. and its largest trading partners will impact the economy, hinting its prepared to cut interest rates if trade tensions hamper the long-running economic expansion.
U.S. stocks clocked the best day since January on the doveish comments with all three major averages rising more than 2 percent.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 44296.51 | +426.16 | +0.97% |
| SP500 | S&P 500 | 5969.34 | +20.63 | +0.35% |
| I:COMP | NASDAQ COMPOSITE INDEX | 19003.651134 | +31.23 | +0.16% |
"We are closely monitoring the implications of these developments for the U.S. economic outlook and, as always, we will act as appropriate to sustain the expansion,” Powell said at a Fed conference in Chicago.
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The policy-setting board last cut rated in 2008 as a result of the financial crisis. The Fed has raised rates nine times since 2015, including four hikes last year. The hikes have irked President Trump who has lashed out repeatedly at the Fed for those actions.