{"id":66235,"date":"2023-11-29T10:05:50","date_gmt":"2023-11-29T15:05:50","guid":{"rendered":"https:\/\/olduvai.ca\/?p=66235"},"modified":"2023-11-29T10:05:50","modified_gmt":"2023-11-29T15:05:50","slug":"deutsche-bank-economists-say-the-fed-will-create-more-inflation-in-2024","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=66235","title":{"rendered":"Deutsche Bank Economists Say the Fed Will Create More Inflation in 2024"},"content":{"rendered":"

Deutsche Bank Economists Say the Fed Will Create More Inflation in 2024<\/a><\/h3>\n
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Deutsche Bank economists say the Federal Reserve will create more inflation in 2024.<\/p>\n

OK, that\u2019s not exactly what they said. But that is the implication of their latest forecast.<\/span><\/p>\n

The Deutsche Bank analyst forecast that the Fed will cut rates by 175 basis points in 2024 in response to a \u201cmild\u201d recession. That would drive the Federal Reserve funds rate down to between 3.5% and 3.75%.<\/p>\n

This loosening monetary policy,\u00a0by definition<\/a>, would create more inflation.<\/p>\n

The Fed currently has interest rates set at between 5.25% and 5.5%.<\/p>\n

Most mainstream analysts now think the central bank will cut rates next year, but not as steeply as Deutsche Bank economists.<\/p>\n

The dominant narrative today is that the Fed has successfully beaten down price inflation.\u00a0A cooler-than-expected CPI report<\/a>\u00a0for October reinforced this notion. With inflation on the run, mainstream analysts think that the Fed has initiated its last hike and will pivot to rate cuts next year to guide the economy to a \u201csoft landing.\u201d Even before the CPI data release markets were pricing in 75 basis points of rate decreases in 2024.<\/p>\n

Many mainstream analysts and financial news network pundits have taken a recession completely off the table. But Deutsche Bank senior US economist Brett Ryan\u00a0told\u00a0Reuters<\/em><\/a>\u00a0he expects the US economy to hit a \u201csoft patch\u201d that will lead to a \u201cmore aggressive cutting profile.\u201d<\/p>\n

Ryan said he expects this economic weakness to further ease inflationary pressure.<\/p>\n

The Problems With the Forecast<\/strong><\/p>\n

There are several problems with the Deutsche Bank projections, and the entire mainstream narrative more generally.<\/p>\n

In the first place,\u00a0the death of inflation is greatly exaggerated<\/a>. No matter how you slice and dice the data, none of the numbers come close to the Fed\u2019s 2% target. Core CPI is still double that number.<\/p>\n

\u2026click on the above link to read the rest\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

Deutsche Bank Economists Say the Fed Will Create More Inflation in 2024 Deutsche Bank economists say the Federal Reserve will create more inflation in 2024. OK, that\u2019s not exactly what they said. But that is the implication of their latest forecast. The Deutsche Bank analyst forecast that the Fed will cut rates by 175 basis […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[15374,172,1839,359,431,23123,534,13351,18779,827,3650],"class_list":["post-66235","post","type-post","status-publish","format-standard","hentry","category-economics","tag-consumer-price-inflation","tag-cpi","tag-deutsche-bank","tag-germany","tag-interest-rates","tag-michael-maharrey","tag-monetary-policy","tag-price-inflation","tag-schiffgold","tag-united-states","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/66235","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=66235"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/66235\/revisions"}],"predecessor-version":[{"id":66236,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/66235\/revisions\/66236"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=66235"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=66235"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=66235"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}