Raising rates may be misguided in a supply shock, Bloomberg guest suggests

Raising rates may be misguided in a supply shock, Bloomberg guest suggests
Bloomberg guest critiques rate increases approach

A Bloomberg guest has suggested that raising interest rates is a mistake when facing a supply shock, arguing that the Federal Reserve is not engaging in a sledgehammer hiking cycle but rather gradually shifting toward a tightening bias.

Axel Merk relayed this perspective, highlighting that the Fed is 'removing a dose of accommodation' instead of conducting aggressive rate increases.

Merk previously noted that October U.S. rate hike expectations surged above 50% following strong CPI data, before easing slightly (link). In a separate update, he flagged France’s reliance on short-term debt markets as a point of financial risk (link). These observations reflect Merk’s ongoing commentary on central bank policy shifts and debt market pressures.

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