JPMorgan Asset Management Chief Global Strategist David Kelly said in an interview with CNBC that the slowdown in the US economy is becoming increasingly evident and that the Fed's expected interest rate cuts will not change this picture. Kelly argued that the weak August employment report and other economic indicators pointed to further softening in the economy, saying, “The economy is not in recession, but it is slowing. All the data indicates that an economy that was already struggling is now nearing exhaustion.” Related News: US President Donald Trump Narrows Down List of Candidates for FED Chair - Announces Three Names Despite market optimism, Kelly argued that interest rate cuts won't boost growth, saying, “I saw the stock market rise today, which clearly reflects the expectation of a rate cut. However, this doesn't solve the fundamental problem. Lowering interest rates will reduce retirees' interest income and signal further rate cuts to the market. In such a scenario, borrowers will have no reason to borrow more.” Kelly, stating that the experience of the 2000s also proves this, added, “The entire 21st century has shown us that interest rate cuts do not stimulate economic growth. The post-financial crisis cuts had no effect. Don't expect the Fed to save the economy.” *This is not investment advice. Continue Reading: JPMorgan Chief Analyst Reveals What Will Happen If the Fed Cuts Interest Rates
