JPMorgan Chase: The Federal Reserve should not cut interest rates again in December

Bill Eigen, a bond expert at J.P. Morgan Asset Management, warned the market ahead of the next Federal Reserve meeting that the room for the Fed to cut interest rates may not be as large as it imagines, and central banks around the world would do well not to cut rates again in December.

He added that this is because there are some signs that the U.S. economy is starting to heat up again, including strong GDP growth, slightly higher than expected inflation data last month and record stock prices. Wage, service and housing inflation seem particularly tricky and could even rise. Housing prices remain one of the biggest drivers of inflation in October, rising 4.9% year-on-year. The Fed has already cut interest rates by 75 basis points so far this year and may be closer to its neutral rate than it thinks.