New Delhi, Aug. 11 -- The US Federal Reserve will have to time its interest rate cuts carefully as new tariffs could push inflation higher next year, making policy choices over the next three to six months particularly crucial, according to a report by Union Bank of India.

The report highlighted that markets are currently pricing in a 60 basis points (bp) cut in the Fed rate during 2025, followed by an additional 70 bp cut in 2026. This is despite warnings from some academics that tariff measures could lead to a spike in inflation in the near term.

It stated "Policy choices over the next three to six months are crucial. The Fed must time its easing carefully".

As per report, investors, believe that any tariff-driven price rise will be ...