On Wednesday, the Federal Reserve will make its first interest rate cut in almost a year. This event is accompanied by numerous expectations and warnings from economists and financial institutions.
Reaction of Key Financial Institutions
Several financial institutions have voiced their opinions on the upcoming rate change. Many note that current economic data supports the need for rate cuts, despite previous hopes for a soft economic landing.
Impact of Rate Cut on Employment
According to Unicredit, employment issues are raising concerns as revised data indicates vulnerabilities in the labor market. Wells Fargo analysts highlight that past rate fluctuations were indicative of internal resistance to changes. They expect that the rate reduction will aim to stabilize inflation amid a complex economic backdrop.
Warnings from Fitch Ratings
Fitch Ratings recently issued serious warnings regarding the impact of government measures on the semiconductor sector. They believe that the U.S. stake in Intel could lead to negative consequences for this sector, including: • The expansion of the Ohio plant may affect Intel's financial health without external support. • State involvement could undermine competitive advantages in the international market. • Pressure from the government could negatively impact the profitability of leading tech companies like Nvidia. These factors could threaten the global competitiveness of American tech giants and influence risk markets, including the emerging cryptocurrency sector.
The Federal Reserve's rate cut may trigger a domino effect in the economy, impacting employment and government policy, which requires careful analysis of the current situation.
