economy

Top Bank Economist Says Fed Should Stop Raising Interest Rates

A leading economist believes the Federal Reserve will raise rates once more, then stop.

By Piggy PressSep 16, 20262 min read 2 new words

In simple terms

If the Fed stops raising rates soon, it could mean lower costs for borrowing money for homes, cars, and other big purchases — but it also depends on inflation and other economic factors.

Andrew Hollenhorst, the chief economist at Citi bank, says it's difficult to justify raising interest rates right now. The data — information about the economy like jobs, inflation, and spending — simply doesn't support more increases. He believes one rate hike is likely coming, but after that, the Federal Reserve should pause and hold rates steady.

Interest rates affect you directly: when the Fed raises rates, borrowing money becomes more expensive, which impacts mortgages, car loans, credit cards, and savings accounts. Hollenhorst's view matters because economists at major banks like Citi influence how markets move and what investors expect next.

Fun fact

The Federal Reserve has raised interest rates multiple times over the past year to fight inflation. Hollenhorst's prediction of 'one and done' means he thinks that era is ending.

Economy

Source: Bloomberg Markets