US EditionUS Fed will likely cut again despite economic murkiness from shutdown
The Fed faces a dilemma as it cuts rates to support a weakening labor market while inflation remains above target amid limited data from the ongoing shutdown.
- On Wednesday, the Federal Reserve is expected to cut its short-term rate for the second time this year, a move analysts call the clearest amid economic uncertainty.
- The government shutdown that began October 1 has paused most official economic releases, while monthly hiring figures had weakened to an average of just 29,000 a month for the prior three months.
- September's inflation read showed Consumer Price Index rose 0.3% in September and 3.0% year-on-year, while the August jobs report added 22,000 jobs with unemployment at 4.3%.
- Traders have priced a near-certain quarter-point cut with 99.9% odds, and a cut would lower the benchmark rate target to between 3.75 percent and 4.00 percent as markets parse Jerome Powell, Fed chair's post-decision press conference.
- Beyond rates, officials consider ending the Fed's securities holdings, which peaked at nearly $5 trillion after the Fed's legal challenge against Lisa Cook reaches the U.S. Supreme Court next year.
123 Articles
123 Articles
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Powell will avoid giving clear guidance for the next meetings - Officials divided into two camps
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