• Investing
  • Stock
  • Editor’s Pick
  • Economy
The Significant Deals
Editor's Pick

Fed seen cutting policy rate by 25 bps in Nov, Dec

by October 31, 2024
written by October 31, 2024

(Reuters) -Federal Reserve policymakers are very likely to go ahead with cutting short-term U.S. borrowing costs by a quarter percentage point next week, traders bet on Thursday, after economic data suggested price pressures continue to ease. 

Inflation by the Fed’s targeted measure, the year-over-year increase in the personal consumption expenditures index, was 2.1% in September, down from an upwardly revised 2.3% in August, a Commerce Department report showed. The Fed aims at 2% inflation.

A separate report from the Labor Department showed the Employment Cost Index rose 0.8% in the third quarter from the previous quarter, less than what economists had forecast and the smallest increase since the second quarter of 2021.

A rise in labor costs was among factors that had alarmed Fed policymakers back then, prompting their pivot to tighter policy.

“Policymakers at the Federal Reserve are likely to be encouraged by this data as wage growth measures at levels consistent with less inflation,” wrote Indeed Hiring Lab Economist Cory Stahle.

Futures contracts settling to the Fed’s policy rate put the chances of a 25 basis point cut next week at about 94%, and give a second 25 basis point in December about a 70% chance.

The reports – the last major economic data, along with Friday’s monthly jobs report, before the Fed’s Nov. 6-7 meeting – did not suggest the U.S. central bank’s battle with inflation is done.

Underlying price pressures, as tracked by the core PCE price index that excludes volatile food and energy, ticked up to 2.7% from a year earlier, higher than the 2.6% economists had expected and matching the prior month’s increase.

Some analysts warned that could prompt the Fed to cut the policy rate to a 4.5%-4.75% range next week, and then hold it there.

“We believe the Fed will pause any rate cuts in December amid fears about a re-acceleration of inflation,” wrote Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management.

This post appeared first on investing.com
0 comment
0
FacebookTwitterPinterestEmail

previous post
US third-quarter labor costs growth smallest in more than three years
next post
Micron falls as Samsung says it has made progress on HBM front

You may also like

China central bank conducts 1.7 trln yuan of...

January 27, 2025

Fuji Media, rocked by sexual misconduct allegations, says...

January 27, 2025

ECB president fears loss of central bank independence

January 27, 2025

European tech shares tumble as China’s AI push...

January 27, 2025

Futures slip as investors eye China’s latest AI...

January 27, 2025

Markets may be repeating the mistake of 2019,...

January 27, 2025

How billionaire Caltagirone could influence Italy’s banking M&A...

January 27, 2025

How Italy’s MPS went from near collapse to...

January 27, 2025

Analysis-To weather Trump, emerging market investors look to...

January 27, 2025

Chinese AI startup DeepSeek overtakes ChatGPT on Apple...

January 27, 2025
Fill Out & Get More Relevant News








    Stay ahead of the market and unlock exclusive trading insights & timely news. We value your privacy - your information is secure, and you can unsubscribe anytime. Gain an edge with hand-picked trading opportunities, stay informed with market-moving updates, and learn from expert tips & strategies.

    Recent Posts

    • Trump implies government could cut contracts and subsidies to Musk’s companies

      June 7, 2025
    • Procter & Gamble to cut 7,000 jobs as part of broader restructuring

      June 6, 2025
    • Shein and Temu see U.S. demand plunge as loophole for cheap goods closes

      June 6, 2025
    • Shein and Temu see U.S. demand plunge as loophole for cheap goods closes

      June 5, 2025

    Categories

    • Economy (245)
    • Editor's Pick (3,646)
    • Investing (505)
    • Stock (6,426)

    Latest News

    • Trump implies government could cut contracts and subsidies to Musk’s companies
    • Procter & Gamble to cut 7,000 jobs as part of broader restructuring

    Popular News

    • How Calvin Klein and Tommy Hilfiger got caught in Trump’s trade war with China
    • Jeju Air shares slump to record low after deadly plane crash

    About The Significant deals

    • Privacy Policy
    • Terms & Conditions

    Copyright © 2025 thesignificantdeals.com | All Rights Reserved

    The Significant Deals
    • Investing
    • Stock
    • Editor’s Pick
    • Economy