Federal Reserve 'Will Be The Last To Cut' Rates, Says Expert Who Still Expects Four Cuts In 2025

Despite mounting pressure and calls for lower interest rates, the Federal Reserve held rates steady at 4.25%-4.5% on Wednesday. This analyst anticipates that the Fed would be among the last central banks to cut interest rates, while still expecting four cuts this year.

What Happened: The Chairman and Founder of Navellier & Associates, Louis Navellier, said that “Other central banks like the Bank of England and the European Central Bank are going to continue to cut rates, so we are still in the midst of a global interest rate collapse.”

This comes as the Bank of England cut its interest rates to 4.25% as widely expected by the market, on Thursday.

According to him, with other central banks cutting their interest rates, “money will slosh back to America because our rates will be higher than everybody else’s.”

“Our Fed will be the last to cut, but I’m still in the camp that they should cut four times this year,” he said.

Navellier also highlighted a positive development in the ongoing U.S.-China trade tensions. He pointed out that China has recently exempted 131 U.S. goods from tariffs, representing approximately $40 billion in trade.

This, according to Navellier, is a “thaw” in the trade dispute, a sentiment backed by the upcoming meeting between U.S. Treasury Secretary Scott Bessent and Chinese trade negotiators this weekend in Switzerland.

“We do have tariffs on autos and reciprocal tariffs against other countries, but the irony is that most reciprocal tariffs are not expected to be enacted, since most countries will be lowering their respective trade barriers and promising to buy U.S. goods,” he said.

See Also: Warren Buffett Falls Behind Nancy Pelosi In Stock Market Returns Over The Last 11 Years: Here’s What Data Shows

Why It Matters: Echoing concerns about a potential economic slowdown, Mohamed A. El-Erian, another prominent economist, noted on X that the Federal Reserve’s statement signaled a “higher probability of a stagflationary wind,” indicating a greater risk of both higher inflation and higher unemployment.

Meanwhile, on stagflation, Ed Yardeni from Yardeni Research said, “We reckoned that the economy would remain resilient. We still think so, but Trump’s Tariff Turmoil (TTT) is stress-testing the resilience of the economy. It will probably slow economic growth and boost inflation. A short bout of stagflation is likely.”

The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, rose in premarket on Thursday. The SPY was up 1.00% to $566.78, while the QQQ advanced 1.31% to $489.61, according to Benzinga Pro data.

After Wednesday, the S&P 500 index was out of the correction zone, just down 8.34% from its record high of 6,147.43 points, scaled on Feb. 19. Dow Jones was 8.78% lower than its 52-week high of 45,073.63 points, and Nasdaq 100 was 10.6% lower than its previous high of 22,222.61 points.

Read Next:

• Beyond Meat Shelves Full-Year Outlook After $7M Hit — CEO Warns Of ‘Unforeseen’ Economic Headwinds, But Downplays Tariff Threat

Image Via Shutterstock