"The Fed, which emphasises its independence from political influence, will weigh new economic data as it considers its next move. The benchmark interest rate has remained at 4.25 percent 4.50 percent since December. So far, the Fed has held rates steady, saying the stance preserves flexibility to respond to economic shocks tied to shifting trade policy. But many economists now believe a rate cut is imminent."
"I think that the Fed has made it pretty clear that they're going to cut rates in September, and the market certainly expects that, Daniel Hornung, policy fellow at Stanford Institute of Economic Policy Research and former deputy director of the National Economic Council, told Al Jazeera. CME FedWatch, which tracks the probability of Fed policy moves, puts the likelihood of a quarter of one percentage point cut at 94.5 percent, echoing research from JPMorgan last month."
The Federal Reserve will hold a two-day policy meeting to decide whether to lower interest rates after a months-long pause. The benchmark federal funds rate has remained at 4.25–4.50 percent since December. Recent indicators point to a cooling labour market while consumer prices have shown continued upward movement, with consumer prices rising 0.4 percent. Many economists and market trackers assign a high probability to a 25 basis point cut in September. Political tensions have increased due to presidential criticism and an allegation against a Fed governor, but analysts cite economic factors as the primary rationale for easing.
Read at www.aljazeera.com
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