Opinion | High expectations ahead of the Federal Reserve meeting. Christina Gavin

High expectations ahead of this week’s Federal Reserve meeting. And the forecasts, which the market depreciated after the meeting on March 20, have changed radically. The inflation data we learned in April of this year regarding the North American economy was the main catalyst for this change in expectations.

While just a month ago the first rate cut in June was taken for granted, the price data coupled with the strength of the North American economy does not justify the move and delays expectations for the start of the cut. betting process for after summer. Some voices even hinted at this. An upward movement is possible.

In our opinion, The last option is unlikely.

The scenario we paint for the coming months regarding the actions of the Federal Reserve is cautious. We believe the Fed will be cautious in its decisions as we wait to see how price data changes in the coming months. The November election will also be a factor in determining the Federal Reserve’s actions.

. Here, we discount the first rate cut in July by 25 bps.given that Waiting for the rate cut process to begin in September will bring us very close to the presidential election.with the noise it would entail.

Cristina Gavin is Head of Fixed Income and Fund Manager at Ibercaja Gestión