When the Federal Reserve meets Wednesday, officials are expected to mark the end of an era as they cut interest rates for the first time in four years.
When the Federal Reserve meets Wednesday, officials are expected to mark the end of an era as they cut interest rates for the first time in four years and chart a course for lower rates over the next two years.to a new range of 5.0-5.25% from its 23-year high of 5.25% to 5.5% on Wednesday when their policy meeting concludes. The actions will officially mark the termination of the most aggressive inflation-fighting campaign since the 1980s.
As for ex-Kansas City Fed chief George, she at a minimum she expects a rate cut of 25 basis points every meeting for the rest of the year. Inflation expectations are also dropping. The difference in the yield on a 10-year inflation-protected government bond and a standard bond of the same maturity, a measure of expected inflation, is around the lowest since early 2021. Inflation expectations over the next two years are for CPI inflation of just 1.5%, under the Fed’s 2% target.
But Wilmer Stith, bond fund manager for Wilmington Trust, said, “I think Powell plays it right down the middle.” Stith added that the Fed is very conscientious of the pain associated with a higher unemployment rate, but also conscientious of the cost of living for the average American.
Kansas City Fed Federal Reserve Fed Officials Wilmington Trust Chair Jay Powell
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