Stocks remain volatile ahead of Fed decision on Wednesday
As economists expect the Federal Reserve to announce another rate hike decision on Wednesday, the CEO of one of America’s most beloved restaurant chains expressed concern that the middle class will bear the brunt of Cavuto: Coast to Coast’s impact. .
“Our consumer is ultimately going to be taxed the most,” TGI Fridays CEO Ray Blanchett told Nilu Cavuto of Fox Business on Tuesday. “We serve America’s middle class in the United States. We are trying to serve the emerging middle class around the world. So inflation poses a threat to us… and we are concerned about rate hikes.”
At the start of the Fed’s two-day meeting, strategists at Goldman Sachs predict that the agency is unlikely to change and cut its benchmark interest rate to 2024 anytime soon as it attempts to tamp down the worst inflation in four decades.
Goldman Sachs also noted that the Fed will implement a third consecutive 75 basis point rate hike this week, followed by half a percentage point hikes in November and December, followed by one quarter percentage point hike in 2023 and one rate cut in 2024.
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While some market analysts expect 40-year high inflation to continue for the next two to three years, Blanchett said the company is paying “close attention” to what’s happening and hopes a “sustainable recovery” can bring inflation down “to what that moment very soon.” .”
Amid rising food and commodity prices, as well as some near-term margin shrinkage, TGI Fridays is refraining from passing price increases on its dollar-for-dollar menu to customers, its CEO said.
“In restaurants, generally speaking, in countries with inflationary economies, we skip some, and then when they return to a kind of historical norm, we usually keep the price,” Blanchett explained. “That’s what bridges the gap between grocery stores and restaurants in times like these.”
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Blanchett also discussed the aggressive expansion of TGI Fridays restaurants in Asian and Southeast Asian markets, citing the area once hit by COVID-19 lockdowns is starting to reopen and operate “extremely well.”
“When people from Asia come to us, they come to us for Western food. They come to us for americano,” the CEO said. “If they are looking for a bowl of noodles or a bowl of rice, there are better options and we are not trying to compete for local food.
Megan Henny of FOX Business contributed to this report.
Credit: www.foxbusiness.com /