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US Fed Meeting LIVE Updates: Following the rate cut decision, US Fed Chairman Jerome Powell will address the media at 1:00 am IST.
US Federal Reserve Chair Jerome Powell.
US Fed Meeting LIVE: The US Federal Reserve is expected to cut the key interest rates by another 25 basis points to 4.25-4.50 per cent. The decision will be announced at 12:30 am IST. Following this, US Fed Chairman Jerome Powell will address the media at 1:00 am IST.
Ahead of the US Fed decision, the US markets are trading in green with the Dow Jones trading up by 0.35 per cent and Nasdaq was up by 0.25 per cent.
It will be the third rate cut in three months, with the first rate cut announced in September (by 50 basis points) and second in November (by 25 bps). The first cut in the current rate cut cycle came in September after a gap of four years.
According to reports, US Federal Reserve officials will likely signal a slower pace of interest rate cuts next year compared with the past few months, which would mean that Americans might enjoy only slight relief from still-high borrowing costs for mortgages, auto loans and credit cards.
The US economy remains resilient, with the job market holding steady and economic growth forging ahead. But inflation’s progress to the Fed’s 2% target may have stalled in recent months. Put together, economic figures show the Fed doesn’t need to be in any rush to lower borrowing costs after this week — a stance communicated by the Fed’s leader recently.
“We can afford to be a little more cautious,” Fed Chair Jerome Powell said in New York earlier this month. “I feel very good about where the economy is and where monetary policy is.”
Inflation data has showed limited progress in recent months.
The closely watched Consumer Price Index rose 2.7% in the year ending in November, accelerating from October’s 2.6% annual increase and marking the highest annual rate since July. The annual figure was in line with economists’ expectations.
Meanwhile, the Producer Price Index, which captures prices at the factory gate, jumped 0.4% on a monthly basis and 3% for the 12 months ended in November, reflecting a sharp pick-up from October.
The Fed’s preferred inflation measure — the Personal Consumption Expenditures price index — is due Friday and could similarly show stubborn price pressures.
