The Fed’s next move

The path for US interest rates has shifted sharply in recent months, as markets move from pricing rate cuts to pricing a potential hike. In this episode, Ronnie Wexler sits down with Barclays’ Chief US Economist Marc Giannoni to look at what’s driving that shift.

At the centre of the discussion is inflation. While headline inflation has been pushed higher by rising energy prices driven by the Iran war, the key question for new Fed chair Kevin Warsh is whether those pressures feed through into core inflation and ultimately shift longer-term expectations. That, Giannoni argues, is what could determine the Fed’s next move.

The conversation also turns to the US consumer. Slowing real income growth, higher gasoline prices and a cooling labour market are starting to weigh on household spending, raising questions about how resilient demand can remain. Whilst these pressures could drive consumer spending down, the US consumer has surprised to the upside many times before according to Giannoni.

So what should investors watch next? From inflation prints to consumer behaviour, listen to learn which signals could shape the Fed’s policy path in the months ahead.

Clients can read more on Barclays Live:

• Waiting for the deal
• What would trigger a 2026 Fed hike?
• Consumers feeling the strain
• April consumer spending moderating amid faltering income

Listeners can also hear more episodes on this topic:

• Inflation crosscurrents: Energy vs AI
• Decoding the bond sell-off
• Do high gas prices change how Americans buy cars?

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