Inflation has risen - interest rate cuts are still unlikely: financial experts remain cautious.

Inflation has risen - interest rate cuts are still unlikely: financial experts remain cautious.

According to a report from www.nzz.ch, the lower than expected inflation data in the USA and the euro zone are reason for speculation that central banks will soon cut interest rates. However, investment experts and economists are cautious and are dampening hopes of interest rate cuts. The investment bank UBS recently caused a stir with its forecast for massive interest rate cuts by the US Federal Reserve totaling 2.75 percentage points by 2024. However, this forecast was described as daring by other experts. Karsten Junius, chief economist at Bank J. Safra Sarasin, does not believe in a quick turn to an expansionary monetary policy and warns that a too early decline in inflation could lead to negative reactions in the financial markets. Investment boss Thomas Heller also believes the financial markets' reaction to the inflation data may be too positive. However, he expects that the stock markets could perform well in the coming year even without interest rate cuts, especially due to the expected economic support from the US government due to the upcoming presidential election.

The potential impact of a Federal Reserve interest rate cut on the market and the financial industry is varied. Lower interest rates can lead to price gains on the stock exchanges and trigger a positive reaction from the stock markets. However, some experts consider a stock rally due to potentially falling interest rates to be premature. In addition, companies could have to contend with higher financing costs, which could potentially have a dampening effect on share prices. Cutting interest rates too early could also be negatively received by the financial markets, as investors are uncertain about what this means for the economy. Bonds are likely to remain attractive for the time being, while leading central banks could probably expect key interest rate cuts from the third quarter of 2024, although the reasons for this may vary in different regions such as Switzerland, the euro zone and the USA.

The current inflation data and the discussions about possible interest rate cuts show that the market and the financial sector are increasingly volatile and depend on various factors. Developments should therefore be monitored closely in order to make informed decisions.