Billionaire hedge fund boss Ray Dalio believes Stock markets will plunge by 20% if the US Federal Reserve raises interest rates to 4.5% to tackle inflation, according to a report by Reuters.
The report cites a LinkedIn post in which the the Bridgewater Associates boss predicted a sharp fall in stock markets as the US Federal Reserve takes an aggressive approach to interest rate rises in a bid to control inflation.
Dalio’s comments came as the latest inflation data showed an unexpected increase in US consumer prices in August leading to the prospect of another interest rat hike nest week.
“…interest rates will go up … other markets will go down … the economy will be weaker than expected,” Dalio wrote. “This will bring private sector credit growth down, which will bring private sector spending and, hence, the economy down with it.”
