Ed Yardeni Sees Fed Pausing Rate Cuts for 2024 After Jobs Report

Ed Yardeni, renowned economist and president of Yardeni Research, has a unique perspective on the Federal Reserve's (Fed) rate cut decisions for 2024. In a recent interview, Yardeni expressed his belief that the Fed will only implement a single rate cut this year, contrary to the expectations of many analysts. This article explores Yardeni's assessment of the economy and labor market, as well as his prediction for the Fed's rate cut decisions.


Yardeni's optimism about the economy and labor market stems from his assessment of consumer resilience. He believes that consumers are weathering the current economic conditions better than initially thought, which reduces the need for multiple rate cuts. In a CNBC interview, Yardeni stated, "The economy is just doing too well. I know that people got freaked out by the last employment report, but I think a lot of that was weather, and some of the other indicators that came out kind of confirmed that."


Yardeni's interpretation of the July jobs report is influenced by weather-related factors. He argues that the weak jobs report was partially due to temporary weather-related issues, which should not significantly impact the overall economic outlook. This interpretation is supported by other indicators that suggest the labor market is still robust.

In contrast to Yardeni's prediction, many prominent economists, such as Jeremy Siegel, anticipate multiple rate cuts this year. Siegel maintains that the base rate should come down to below 4%, representing a significant drop from the current rate of over 5%. However, Yardeni remains unconvinced that the data supports such a substantial cut.

Yardeni's prediction has potential implications for investors in the stock market and other asset classes. If he is correct, and the Fed implements only a single rate cut, it could lead to a more dovish monetary policy stance. This could potentially boost stock market performance, as lower interest rates make borrowing cheaper for businesses and consumers, stimulating economic growth.

In conclusion, Ed Yardeni's assessment of consumer resilience and his interpretation of the July jobs report lead him to predict a single rate cut by the Fed in 2024. While other prominent economists anticipate multiple rate cuts, Yardeni's optimism about the economy and labor market supports his prediction. The potential implications of Yardeni's prediction for investors in the stock market and other asset classes underscore the importance of staying informed about the Fed's rate cut decisions.