Citadel CEO and billionaire Ken Griffin believes the Fed will cut interest rates one more time this year, bringing it down to a range of 3.75%-4.00%. He believes that a weakening labor market will push the central bank to prioritize maximum employment over inflation.
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“I think the Fed is nervous about the labor market because we did see this decline in the number of jobs being created, and in terms of balance of risks they chose to focus on the unemployment side rather than on the inflation side,” said Griffin.
Griffin’s view is at odds with CME’s FedWatch tool, which assigns a 67% chance of two more rate cuts by year-end.
Griffin Sounds Alarm on Fed Independence Threat
Earlier this month, Griffin penned a column in the Wall Street Journal, warning that President Trump’s interference with the Fed risks economic disruption.
“These actions raise inflation expectations, increase market risk premiums, and weaken investor confidence in U.S. institutions,” wrote the Citadel CEO.
Trump previously criticized Fed Chair Jerome Powell for delaying rate cuts and has sought to fire Fed Governor Lisa Cook for alleged mortgage fraud.
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