TÜSİAD Chief Economist Gizem Altınsaç makes a statement about the Central Bank of America.

TÜSİAD Chief Economist Gizem Öztok Altınsaç made important statements about the Federal Reserve. Altınsaç stated that we may see a suppressive Fed decision in the coming days.

Özyeğin University Lecturer and TÜSİAD Chief Economist Gizem Öztok Altınsaç made evaluations before the Fed meeting that will take place in the coming days. Successful economist Altınsaç stated that she did not expect the Fed to increase interest rates by 75 basis points, adding that they had clearly emphasized that they would increase by 50-50 basis points in the previous meetings, and that perhaps a 75 basis point increase could be seen in September. TÜSİAD Chief Economist Altınsaç continued her assessment with the following statements: “After the latest inflation figure, we see that there is a tendency to increase interest rates by 75 basis points in this meeting as well. It's going to be a tough Wednesday for Powell. On the one hand, if he chooses a more aggressive price policy, the probability of the economy going into recession will increase. But we'll probably be talking about it by the end of 2023. If it maintains its soft state, that is, 50-50 basis points, then inflation expectations will continue to deteriorate further. Actually, we were expecting Fed to go to 50-50 basis points. There was a thought that they would wait for the most recent inflation, and then there is a chance that we will see the Fed in a meeting that came with 75 basis points during the year, and there are even institutions waiting 75-75 basis points. Therefore, we will see an aggressive Fed, I don’t think they will do a 75 because 50-50 basis point is seen as a clear line in this meeting, but if they do, it will seriously surprise the market. There is a somewhat more challenging process in terms of central bank communication. There was an underestimation of inflation on the Fed side. So it needs to see a cleaner picture so to speak. This is why Fed is getting aggressive. Because both the supply-side price increases continue to be strong on the global side and the service inflation in the US economy has been very strong. The US economy is in a state of collapse, so the reaction of the central banks in such a situation should be to become aggressive. Actually, it was a policy mistake that it fixed itself at 50-50 basis points. Now it is difficult for two meetings to turn from here and move forward to 75 basis points. Maybe they will turn to 75 basis points in September to fix this mistake.”