Svmuu News: Ludovic Subran, chief economist at Allianz, said, “The U.S. nonfarm payrolls data was actually weak, but I still believe inflation will peak above 3.7%, and that artificial intelligence, fiscal stimulus, and the energy sector continue to underpin economic growth. The Federal Reserve may have to raise interest rates in September.“I think this is where the real divergence between the U.S. and Europe lies.”
Subran believes that following last month’s rate hike, European Central Bank (ECB) will not take further action.“That was a precautionary rate hike, but judging by the current data, it seems to be a thing of the past,” he said. “The traumatic effects of the (Iran) war will take time to manifest, and the economy is still bearing the costs of the war, but the situation today is much better than it was a few weeks ago.” (Jin Shi)