“Inflation is continuing its march unabated,” Ackman said, noting that CEOs across the country are lifting prices to offset rising costs. The hedge fund manager added that American consumers and companies have plenty of cash and little debt, and banks have maintained historically low loan-to-deposit ratios, so widespread recession fears won’t be enough to curb inflation or make the Fed shy away from further hikes.
“The potential for a future recession won’t stop the Fed from raising rates now,” Ackman wrote.
The Pershing Square chief previously warned stocks would continue dropping until the Fed signals it’s committed to tackling inflation.
“It ends when the Fed puts a line in the sand on inflation and says it will do ‘whatever it takes,'” Ackman tweeted in late May. “And then demonstrates it is serious by immediately raising rates to neutral and committing to continue to raise rates until the inflation genie is back in the bottle.”
