The wealth giants from Switzerland, UBS have made a prediction of the Federal Reserve lowering the rates of interest thrice in the year 2020. This forecast is different in a wide manner from a lot of the other projections which have been calling for none or at the most one rate of interest cut in the year.
Their economist, Arend Kapteyn said this Tuesday that the tariffs which have been implemented during the trade war in between United States and China is going to drag the growth of United States to a level of only 0.5% year over year in 2020’s first half.
The last raise on the tariffs on goods from China by United States had taken place in the month of September as China followed up by increasing their own duty on a lot of the products from America. There was further increase which had been scheduled initially for the month of December however it was put off with both of the sides agreeing to come up with a phase one deal.
He said that the damage from these tariffs will be pushing the growth from United States down and that is going to trigger a few more cuts from the Fed which is a long way away from the general consensus and is not going to be believable for many.
He further noted that the officials of Fed had themselves show no inclination in making any of the moves with the meetings recently indicating that they are at a comfortable level of hold and would wait for a downshift in the data before they make an assessment of their position which UBS feels is going to happen.