Add as a preferred source on GoogleDario Perkins Sees Scenario for Fed Peak Rate Matching 2023-24 High
The scenario depends on continued AI investment and is separate from TS Lombard’s official forecast of quarterly rate hikes.
Dario Perkins, TS Lombard’s managing director of global macro, sees a scenario in which the Federal Reserve’s peak rate could match or exceed the 5.25%-5.50% range reached in 2023 if AI investment continues. The outcome is conditional and separate from the firm’s official forecast.
TS Lombard’s official forecast calls for a 25-basis-point rate hike each quarter until something breaks. Perkins’ higher-rate scenario is not the firm’s base-case forecast.
The Fed’s target range is 3.75%-4.00%. The Federal Open Market Committee (FOMC) raised it to that level on Sept. 16, effective Sept. 17.
The range cited in Perkins’ scenario was reached on July 27, 2023, and remained in place until the Fed’s first subsequent rate cut, on Sept. 19, 2024.
The FOMC is scheduled to meet Oct. 27–28.