• Economy
  • Editor’s Pick
Money Rise Today – Investing and Stock News
  • Investing
  • Stock
Stock

Fed minutes point to ‘likely’ rate cut coming in September

by August 22, 2024
written by August 22, 2024

Federal Reserve officials at their July meeting moved closer to a long-awaited interest rate reduction, but stopped short while indicating that a September cut had grown increasingly probable, minutes released Wednesday showed.

“The vast majority” of participants at the July 30-31 meeting “observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting,” the summary said.

Markets are fully pricing in a September cut, which would be the first since the emergency easing in the early days of the Covid crisis.

While all voters on the rate-setting Federal Open Market Committee voted to hold benchmark rates steady, there was an inclination among an unspecified number of officials to start easing at the July meeting rather than waiting until September.

The document stated that “several [meeting participants] observed that the recent progress on inflation and increases in the unemployment rate had provided a plausible case for reducing the target range 25 basis points at this meeting or that they could have supported such a decision.”

One basis point is 0.01 percentage point, so a 25 basis point reduction would be equivalent to a quarter percentage point.

In the parlance the Fed uses in its minutes, which do not mention names nor specify how many policymakers felt a certain way, “several” is a relatively small number.

However, the summary made clear that officials were confident about the direction of inflation and are ready to start easing policy if the data continues to cooperate.

The sentiment was twofold: Inflation markers had shown price pressures easing considerably, while some members noted concerns over the labor market as well as the struggles that households, particularly those at the lower end of the income spectrum, were having in the current environment.

“With regard to the outlook for inflation, participants judged that recent data had increased their confidence that inflation was moving sustainably toward 2 percent,” the minutes stated. “Almost all participants observed that the factors that had contributed to recent disinflation would likely continue to put downward pressure on inflation in coming months.”

On the labor market, “many” officials noted that “reported payroll gains might be overstated.”

Earlier Wednesday, the Bureau of Labor Statistics reported, in a preliminary revision of the nonfarm payroll numbers from April 2023 through March 2024, that gains may have been overstated by more than 800,000.

“A majority of participants remarked that the risks to the employment goal had increased, and many participants noted that the risks to the inflation goal had decreased,” the minutes said. “Some participants noted the risk that a further gradual easing in labor market conditions could transition to a more serious deterioration.”

In its post-meeting statement, the committee noted that job gains had moderated and that inflation also had “eased.” However, it chose to hold the line on its benchmark funds rate, which is currently targeted in a 5.25%-5.50% range, its highest in 23 years.

Markets rose the day of the Fed meeting but cratered in following sessions on worries that the central bank was moving too slowly in easing monetary policy.

The day after the meeting, the Labor Department reported an unexpected spike in unemployment claims, while a separate indicator showed the manufacturing sector contracted more than expected. Things got worse when the nonfarm payrolls report for July showed job creation of just 114,000 and another tick up in the unemployment rate to 4.3%.

Calls grew for the Fed to cut quickly, with some even suggesting that the central bank do an intermeeting move to head off worries that the economy was sinking fast.

However, the panic was short-lived. Subsequent data releases showed jobless claims drifting back down to normal historical levels while inflation indicators showed price pressures easing. Retail sales data also was better than expected, assuaging worries of consumer pressure.

More recent indicators, though, have pointed to stresses in the labor market, and traders largely expect the Fed to begin cutting rates in September.

This post appeared first on NBC NEWS
0 comment
0
FacebookTwitterPinterestEmail

previous post
David Marcus: Meet the RFK voters who could cause an earthquake in the 2024 election
next post
David Marcus: Meet the RFK Jr voters who could cause an earthquake in the 2024 election

related articles

Dick’s Sporting Goods stands by full-year guidance —...

May 28, 2025

Macy’s CEO says retailer will hike some prices...

May 28, 2025

23andMe to delist from Nasdaq, deregister with SEC

May 28, 2025

Walmart fined for shipping realistic toy guns to...

May 28, 2025

Why Trump’s iPhone tariff threat might not be...

May 25, 2025

Trump clears Nippon merger with U.S. Steel

May 24, 2025

United Airlines reaches ‘industry-leading’ labor deal with flight...

May 24, 2025

FTC drops Biden-era suit accusing Pepsi of price...

May 23, 2025

How UnitedHealthcare became the face of America’s health...

May 22, 2025

Burger King targets families through movie partnerships in...

May 22, 2025
Enter Your Information Below To Receive Free Trading Ideas, Latest News, And Articles.


Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest News

  • Markets are clamoring for the Fed to start cutting soon: ‘What is it they’re looking for?’

    August 2, 2024
  • Trump, Harris trade barbs on crime during first presidential debate: ‘Through the roof’

    September 11, 2024
  • S&P 500 and Nasdaq: New Targets and Prices for Wednesday

    October 9, 2024
  • Biden top adviser Anita Dunn leaves White House for Super PAC supporting Harris

    July 30, 2024
  • Johnson demands Zelenskyy fire Ukraine’s ambassador to US amid fallout from Pennsylvania trip

    September 25, 2024

Popular Posts

  • 1

    Secret Service admits leaning on ‘state and local partners’ after claim it ignored Trump team’s past requests

    July 21, 2024
  • 2

    Elon and Vivek should tackle US funding for this boondoogle organization and score a multimillion dollar win

    December 4, 2024
  • 3

    Forex Profit Calculator: Maximize Your Trading Potential

    July 10, 2024
  • 4

    Five more House Democrats call on Biden to drop out, third US senator

    July 19, 2024
  • 5

    Biden calls to ‘lower the temperature’ then bashes Trump in NAACP speech

    July 17, 2024

Categories

  • Economy (829)
  • Editor's Pick (4,697)
  • Investing (624)
  • Stock (770)

Latest Posts

  • SafeMoon continues to move under moving average pressure

    August 8, 2024
  • Biden admin extends $10B Iran sanctions waiver 2 days after Trump election win

    December 11, 2024
  • Michelle Obama skips Trump inauguration as Barack arrives solo

    January 20, 2025

Recent Posts

  • Who’s who on Trump’s short list for attorney general

    November 12, 2024
  • EURAUD and EURNZD: EURNZD could slip to a new weekly low

    July 30, 2024
  • Bitcoin hits $76K, Dogecoin dips: Crypto prices surge on Trump victory

    November 7, 2024

Editor’s Pick

  • EURUSD and GBPUSD: Euro continues to slide under pressure

    September 4, 2024
  • British PM makes unfortunate ‘return of the sausages’ gaffe during serious speech

    September 24, 2024
  • Senate Democrats rail against RFK Jr. in late-night session ahead of vote

    February 13, 2025
  • About us
  • Contacts
  • Privacy Policy
  • Terms & Conditions

Disclaimer: moneyrisetoday.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2025 moneyrisetoday.com | All Rights Reserved

Money Rise Today – Investing and Stock News
  • Economy
  • Editor’s Pick
Money Rise Today – Investing and Stock News
  • Investing
  • Stock