1 min read
Add as a preferred source on GoogleDutta Says Fed Risks Over-Tightening in Its Inflation Fight
He said investors may be underestimating how hawkish policy needs to be and named excessive tightening the main risk looking toward 2027.
The Federal Reserve has been slow to confront inflation, but the delayed effects of monetary policy raise the risk that efforts to contain price pressures will go too far, Renaissance Macro Research analyst Neil Dutta said.
Dutta said investors continue to underestimate how hawkish the Fed may need to be. He pointed to delays in how monetary policy affects the economy and said inflation itself tends to lag.
Dutta called excessive tightening the foremost risk looking toward 2027. He described current conditions as a warning if Waller is treated as a guide to the Federal Open Market Committee’s stance.