The US inflation data was just released and was higher than expected, which reinforces expectations that the Fed will not lower interest rates at its meeting scheduled for the end of this month. As long as inflation has not reached the official target of 2%, raising or keeping interest rates high will be considered a wise choice.
Forget about Trump's repeated statements; the current rise has achieved what the market wanted. We thank here the institutional economy; where decisions are based on data and indicators, not political whims.
The Fed is aware that any haste in lowering interest rates could take us back to the experiences of the 1970s. Therefore, I expect the Fed to adhere to the "Higher for longer" policy, keeping interest rates high for an extended period, so that it can monitor the impact of rising inflation — and the focus is now on the upcoming September meeting, where we will hold the real discussion at that time.
