Truth or Consequences: The Fed’s Next Move

Dr. David Kelly, Chief Strategist at J.P. Morgan Asset Management, discusses the upcoming Federal Open Market Committee (FOMC) meeting on September 15th, 2025. He analyzes market forecasts predicting interest rate cuts, contrasting them with the Fed's own economic projections and stated policy. Kelly anticipates minor adjustments to GDP and unemployment rate forecasts, but a significant upward revision to inflation projections due to tariff effects. He questions the rationale behind potential rate cuts given the inflation outlook and suggests the decision may be influenced by political pressure. He concludes by advising investors to adopt a more cautious and globally diversified approach due to market frothiness and the potential negative consequences of a rate cut driven by political considerations.