Fed must deliver 50bp rate cut to avert recession

The Federal Reserve is teetering on the brink of a critical decision—one that could either save the US economy from a looming recession or plunge it deeper into peril, warned the chief executive of a leading independent financial advisory and fintech.

Nigel Green, CEO of deVere Group, is leading the charge for a supersized 50-basis point interest rate cut in September is growing louder.

The financial heavyweight warns that only a bold, decisive action from the Fed can prevent an economic catastrophe.

Green’s urgent message follows Fed Chair Jerome Powell’s comments at the Jackson Hole central bankers’ summit that, “the time has come for policy to adjust. The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

The deVere CEO said that as the Fed is winning the war on inflation, “we must now look to the broader economy which is standing on a knife edge.”

“Consumer confidence is wobbling, spending is slowing, and corporate earnings are under threat. The Fed cannot afford to tiptoe around these warning signs with a cautious 25-point cut. It’s simply not enough.”

Green warned that the Federal Reserve is running out of time.

“The truth is, the Fed was too slow to act when this cycle began. A small cut might signal a shift, but it won’t deliver the jolt needed to prevent a potential hard landing.”

A 50-basis point cut in September would send a powerful message to the markets, “that the Fed is serious about steering the US economy away from the brink.”

The head of the deVere Group concluded that the Fed must stop playing catch-up and start leading the charge. Anything less than a 50-basis point cut in September would be a missed opportunity – one that the economy, and Americans, can’t afford.

“It’s time for the Fed to act boldly, cut rates aggressively, and send a clear message that it’s ready to do whatever it takes to keep the US economy on track.”