"Yesterday evening the Federal Reserve (the Fed) opted to cut the federal funds rate by 0.25 percentage points, marking the third consecutive meeting to yield lower rates. Following the lengthy government shutdown, the production of official data remains disrupted, creating challenges for policymakers and obscuring the true state of US economic performance. The limited indicators available point to slowing job gains alongside elevated inflation."
"Ultimately, in accordance with revised Cebr projections, the Fed has placed greater weight on the downside risks to employment in this meeting, which culminated in a split decision. That said, the path for future reductions is less clear; trade-related inflationary pressures and lingering uncertainty are likely to muddy the water for the central bank. Cebr expects that, in the January meeting, caution will prevail and the Fed will hold following a 'hawkish cut' this month."
The Federal Reserve reduced the federal funds rate by 0.25 percentage points at its latest meeting, marking the third consecutive reduction. Official economic data production remains disrupted after a lengthy government shutdown, complicating policymakers' assessment of the US economy. Available indicators point to slowing job gains while inflation remains elevated. Revised Cebr projections indicate the Fed placed greater weight on downside employment risks, producing a split vote. The outlook for further rate cuts is uncertain due to trade-related inflationary pressures and lingering uncertainty. Cebr expects the Fed to hold rates at the January meeting after a 'hawkish cut' this month.
Read at London Business News | Londonlovesbusiness.com
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