Fed Interest Rate Hike Is Over? Here's the Analyst's View!

<p>&nbsp;The hawkish Federal Reserve (Fed) Chairman Jerome Powell appears to have failed to change analysts' view that the tightening cycle is over.</p><p><br /></p><p>Most of them expected that an increase in US interest rates to a range of 5.25%-5.50% would signal an end to tightening by the central bank.</p><p><br /></p><p>The chief US economist at Morgan Stanley in a Financial Times report, said that nothing in Powell's policy statement or press conference caused him to doubt the view that rate hikes are over.</p><p><br /></p><p>He added that consumers, employment and inflation are slowing down and all economic performance is in line with his expectations.</p><p><br /></p><p>In general, economists expect inflation to continue to moderate over the next few months.</p><p><br /></p><p><br /></p><p>Ian Shepherdson, chief economist at Pantheon Macroeconomics, believes that core inflation (excluding food and energy prices) will continue to increase by just 0.1%-0.2% in July and August.</p><p><br /></p><p>It equates to a three-month annualized rate of just 1.8% by the time the FOMC meets again in September.</p><p><br /></p><p>Contrary to Jonathan Pingle, chief economist at UBS who thinks there will be an increase in the future, until the Fed gets more confirmation on inflation.</p><p><br /></p><p>Additionally, economists at Oxford Economics point to other hidden surprises that could prompt the Fed to maintain its aggressive grip on the economy, including another bounce in US food prices triggered by El Niño.</p><p><br /></p><p>What is your opinion? Is the Fed's tightening cycle over?</p>