11/15/2024

Strong U.S. Data Feeds Doubts about Fed December Rate Cut

Investors trim odds for a December cut

Strong U.S. economic and inflation data continue to reshape the debate among Federal Reserve policymakers over the pace and extent of interest rate cuts as investors on Friday further downgraded their expectations for a rate reduction at the central bank's December meeting.

In the latest round of comments on U.S. monetary policy, U.S. central bankers continued to express faith that inflation was coming under control and would allow the central bank to lower its benchmark rate over time from the current 4.5 percent-4.75 percent range, a level felt to discourage spending and investment, to a more neutral setting.

But how fast they do that, and what level represents "neutral," remain under debate, with Fed Chair Jerome Powell on Thursday saying the economy's continued strength meant the Fed could take its time with the discussion.

Please select this link to read the complete article from The Washington Post.