Bloomberg Daybreak: Asia Edition Monetary Policy in Focus Ahead of Fed, BOJ Decisions
7 snips
Sep 15, 2025 Adam Coons, Chief Investment Officer at Winthrop Capital Management, dives deep into monetary policy as the Federal Reserve prepares for crucial decisions. The conversation hones in on the anticipated interest rate cut and its implications in a slowing job market. Coons discusses the effects of tariffs on consumer behavior, while also addressing concerns about stagflation. Additionally, he sheds light on how these developments may impact currency fluctuations, particularly between the U.S. dollar and the Japanese yen.
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Fed Likely To Take A Measured Cut
- The Fed is likely to cut 25 basis points rather than 50 because data tilt is only modestly negative.
- A 25bp cut preserves ammunition for future easing if conditions worsen.
Stagflation Risk Is Transient
- Stagflation headlines are possible but would likely be short-lived because higher prices curb demand.
- If prices spike while consumers are tapped out, that could push the economy into recession and reduce inflation.
Read The Fed’s Rhetoric, Not Just The Cut
- Watch Fed rhetoric not just the cut size; signals about future cuts will move markets.
- If the Fed hints at pausing after a 25bp move, expect equity sell-offs; if they signal continued cuts, markets will rally.