Brian Moynihan predicts no interest rate cuts in 2025

In the United States, on March 28, 2025, Bank of America CEO Brian Moynihan addressed concerns regarding recent tariffs announced by President Donald Trump, particularly focusing on auto import levies that are set to take effect soon. Moynihan noted that these tariffs are likely to increase car prices and potentially slow vehicle purchases, predicting a quarter percent inflation increase as a result. He acknowledged the uncertainty surrounding the economic landscape as businesses adjust to these changes and remarked that these unprecedented conditions are impacting market behavior. Furthermore, Moynihan provided an outlook on the U.S. economy, highlighting a positive growth forecast that projects a gradual rise from one-and-a-half percent to two percent in the coming quarters. He emphasized that despite fears of decreased consumer spending amid tariff discussions, the data from Bank of America indicates that consumer spending has not yet shown signs of slowing down, with an average spending increase of five percent compared to the previous year. He attributed this resilience in consumer behavior to steady employment rates and increasing wages, providing a solid foundation for economic stability in the U.S. The unemployment rate remains favorable at 4.1%, as reported by the Bureau of Labor Statistics, contributing to positive spending patterns among consumers. Moynihan pointed out that smaller and medium-sized enterprises are adopting a cautious approach due to the uncertainties created by tariff implementations, often holding back on borrowing from lines of credit. This cautiousness reflects a broader hesitance among businesses, as they await further clarification and stability in the economic environment. Overall, Bank of America remains optimistic about consumer behavior and future economic growth, although the imposing tariffs introduce additional challenges that require thorough consideration by both businesses and consumers. Moynihan’s insights indicate that the current economic momentum could continue if consumers maintain spending levels and employment remains stable, despite the evolving landscape due to external trade policies.