At the third Global Financial Leaders Investment Summit held in Hong Kong, Bob Prince, Chief Investment Officer of Bridgewater Associates, stated that President-elect Trump's tariffs, fiscal stimulus, and immigration policies could hinder the United States from achieving its 2% inflation target. If the U.S. inflation rate remains close to 3% in a year and a half, Trump may be inclined to nominate a Federal Reserve chair candidate who is willing to accept a higher inflation target in order to lower interest rates. Prince added, "People are expecting interest rate cuts, but if the inflation rate remains unchanged, rate cuts may not be feasible. I think the situation in 18 months will be very interesting, at which point the current Federal Reserve Chair Jerome Powell's term will end."

BlockBeats News, November 20th - Bob Prince, Chief Investment Officer of Bridgewater Associates, stated on Wednesday at the third annual Global Financial Leaders Investment Summit held in Hong Kong that U.S. President-elect Trump's policies on tariffs, fiscal stimulus, and immigration may prevent the U.S. from achieving a 2% inflation target. If the U.S. inflation rate remains close to 3% after about a year and a half, Trump may lean towards nominating a Fed chair candidate willing to adhere to a higher inflation target, allowing him to cut rates. Bob Prince added, "People are expecting rate cuts. But if the inflation rate stays the same, then rate cuts may not be possible. I think the situation will be very interesting in 18 months, by which time the term of current Fed Chair Powell will end." (FXStreet)

Bridgewater: Trump May Nominate Federal Reserve Chair Candidate Who Supports Higher Inflation Target