TechFlow news, September 26 — According to Jinshi Data, Tom Lee, co-founder of Fundstrat, said that although markets are currently pricing in two more Fed rate cuts this year, a single cut may not necessarily be bearish.
Lee stated that if the Federal Reserve decides to implement only one rate cut by the end of 2025, "the market could interpret this positively, as they would prefer to see central banks cutting rates when the economy is strong rather than weak." Market participants have slightly lowered their expectations for quarterly Fed rate cuts following Thursday's lower-than-expected initial jobless claims data.
Lee added, "We know the Fed has lagged on easing due to estimated housing inflation factors, but the reality is they should have started cutting earlier... Therefore, we must remain cautious. When the Fed discusses these estimation effects, it doesn't mean we need to initiate a new hiking cycle simply because data shows lags. I think this is precisely what the market sees through."
