Federal Reserve officials risk the worst monetary policy mistake in the central bank’s history by keeping rates elevated as the U.S. economy slips toward recession, according to QI Research CEO Danielle DiMartino Booth.
Key Takeaways:
QI Research CEO Danielle DiMartino Booth says the Fed risks a historic policy error by holding rates while Q4 GDP hit 0.5%. U.S. consumer spending slowed to a 0.6% rate in early 2026, with 14 consecutive months of negative payroll revisions signaling labor damage. The April jobs report and Kevin Warsh’s confirmation battle with Sen. Thom Tillis will determine the Fed’s next policy move. Precious Metals and Short-Duration Bonds Are Best Bets as Fed Keeps Policy Tight, Danielle DiMartino Booth Says“The idea that the Fed is going to hike rates in this environment is ludicrous,” Booth said. “This is going to go down as one of the biggest policy errors in the history of the Federal Reserve. The Federal Reserve is going to ignore what’s staring them in the face.”
Booth pointed to the National Bureau of Economic Research’s tracking of personal income after government transfers, which is already showing a recessionary reading. She cited 14 consecutive months of negative payroll revisions and said sell-side economists at major firms have begun using the word recession openly.
“Until criminal charges against Jerome Powell are dropped, every Federal Reserve official in office today is going to hide behind whatever they can to justify staying in a hawkish stance and threatening to raise rates,” Booth said. “Period.”
The April payroll report is the next major data point Booth is watching, given that the March jobs report was boosted by seasonal adjustment anomalies, including 79,000 workers counted as weather-affected and 100,000 jobs added via the birth-death model adjustment.
