Ahead of the December meeting, one economist argued the Federal Reserve's "dangerously high" interest rate hikes are transitory, and that the Fed will make cuts in the first quarter of next year.

On "Mornings with Maria," Monday, TrendMacro CIO Donald Luskin explained his frustration with the Fed's rate hike campaign and his economic outlook. 

"Please, please, please, can we all stop listening to Jay Powell? Please. Mr. Inflation is transitory. He is still so embarrassed about that one. He's now insisting that his dangerously high-interest rates are not transitory. Oh, they will be," Luskin said. "Inflation is collapsing and he knows it. It's turning into deflation like I warned last time we talked. There will be rate cuts in Q1."

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The Fed has raised interest rates sharply over the past year, approving 11 rate increases in the hopes of crushing inflation and cooling the economy. In the span of just 16 months, interest rates surged from near zero to above 5%, the fastest pace of tightening since the 1980s.

The Fed voted during meetings in both September and November to hold interest rates steady at a range of 5.25% to 5.5%, the highest level in 22 years. 

Luskin argued the economy has already felt the effects of the rate hike campaign and claimed signs point to coming deflation.

"We did four back-to-back 75 basis point rate hikes in the middle of last year. That's never happened before. The last of them was over a year ago. Don't you think we'd start seeing that right now?" Luskin said. 

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Despite the hawkish overtures, investors see a near 100% chance that Fed officials will hold interest rates steady at their final meeting of the year on Dec. 12-13, according to data from the CME Group's FedWatch tool, which tracks trading. 

Other investors also expect the central bank to begin cutting rates in the middle of next year amid signs the economy is cooling.

While inflation has cooled considerably in recent months, it remains up 3.2% compared with the same time a year ago, according to the most recent Department of Labor data. Ahead of the December meeting, Fed officials are now trying to figure out whether they have tightened monetary policy enough or whether they need to raise rates higher in order to crush still-high inflation.

"In two weeks, the next time CPI reports, it's going to be the second back-to-back monthly number with a minus sign in front of it. We are at the beginning of the wavefront of outright deflation," Luskin predicted.

While Luskin predicts some "panic" with the coming deflation, the economist believes the U.S. economy is "in the beginning of the triumphal phase."

"People are starting to be really, really thrilled that this rate hike cycle is over and that we haven't had any kind of landing at all," he said.

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"We are going to have statistical deflation, which I think is a very good thing after the big inflation we've had. That doesn't mean the Fed won't panic. That doesn't mean the market won't panic. So I think, probably sometime late first quarter of next year, second quarter, we're going to have a severe correction in stocks. It will be a buyable dip." 

"There will be deflation, but deflation will be just what we need after the big inflation that will prolong and expand this business cycle expansion."

FOX Business' Megan Henney contributed to this report.