The Federal Open Market Committee is most likely to cut interest rates again to 4.25% to 4.5% on December 18 according to fixed income markets.
The Federal Open Market Committee is most likely to cut interest rates again to 4.25% to 4.5% on December 18 according to fixed income markets and the tone of two recent speeches from Federal Reserve governors. Prediction site Kalshi, currently gives a similar 73% chance of a cut. There is more economic data on jobs and inflation to come before the FOMC meets, but with subdued inflation and a somewhat softening jobs market, a cut appears likely.Recent Fed Statements
The FOMC did cut interest rates at its two previous meetings in September and November after holding rates at peak levels for over a year. Generally, policymakers have signaled that interest rates are likely to move lower over the next year, but the pace of interest rate cuts will depend on incoming data.
Concern that inflation appears potentially stuck above the FOMC’s 2% annual target could delay looser monetary policy, though policymakers appear to be more inclined to look at the broader trend of disinflation rather than worry about single datapoints.
