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In September of 2019 the Federal Reserve cut federal funds rates by 25 basis points, and it now sits at 1.75 – 2%. It is now October and the Federal Open Markets Committee is meeting again from the 29th until the 30th – what can we expect to see?
On October 29th and 30th, 2019, the Federal Open Market Committee (FOMC) is set to meet to discuss federal interest rates, and a decision on whether or not to further lower these rates – which have already seen cuts twice this year – is expected. As ever, the financial sector is rife with speculation as to what the verdict will be after the Fed meeting. Rumors have been circulating since the last announcement that committee members are evenly split – some in favor of further cuts, and others cautioning against. According to Yahoo! Finance, “Two weeks before the Fed’s Interest rate decision, and policymakers still haven’t budged from their September meeting positions.” It is widely expected that the market will see a further quarter-point reduction from the last cut, bringing the target range for the U.S. funds rate down to 1.5% to 1.75%. Jerome Powell, Chairman of the FOMC, has said that these cuts are part of the central bank’s “mid-cycle adjustment” despite a modest de-escalation in the trade war with China.
Fed officials have previously asserted that the two cuts we’ve seen thus far in 2019 are in response to fears of global slowing, U.S.-China tariffs, and are an effort to tame inflation rather than an indication that the economy of the United States may be in trouble. Some experts have been forecasting another recession reminiscent of the Great Recession of 2008. Whether the economy will show signs of growth rather than decline will be determined by several factors, including inflation, the global economy, and the U.S.-China trade relations. Powell has been firm, however, staving off this speculation – and San Francisco Fed President Mary Daly affirmed this, saying, “Right now, I see the economy in a good place, and policy accommodation in a good place.” Fed leaders have pointed to progress on Brexit, as well as some progress on trade negotiations between the United States and China, as signals that the situation is not as dire as some doomsayers might indicate. As of this writing, the latest probability of a 25-basis point FOMC rate cut is 75.4% according to the CME Fedwatch Tool. According to Goldman Sachs, the probability of a rate cut is 95%. Here at BestCards.com, our team is dedicated to bringing you the latest news in the world of credit. Check back at the end of next week for our analysis of the October FOMC meeting.
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BestCards is an independent, Florida-based credit card comparison platform. Many of the card offers that appear on this site are from companies from which BestCards receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). BestCards does not include all card companies or all card offers available in the marketplace.
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