Vanguard, managing a vast global portfolio, anticipates a moderation in the pace of rate cuts by the Federal Open Market Committee (FOMC). This projection stems from the firm’s expectation of a “deferred landing” scenario for the US economy. In this scenario, economic growth persists alongside elevated inflation levels, exceeding the Federal Reserve’s desired target but remaining below the threshold for interest rate increases.
Additionally, Vanguard sounds an alarm regarding the potential for excessive government spending. The firm cautions that fiscal profligacy could further exacerbate inflationary pressures and undermine the long-term stability of the economy.
