The Federal Open Market Committee (FOMC) unanimously voted to pause further rate cuts at the conclusion of its two-day meeting in Washington, D.C. The move was somewhat expected, as policymakers previously indicated the intention to take a patient approach to interest rate changes in 2025.

In a statement released following the meeting, FOMC said that the economic activity in the country continued to expand “solid pace,” while adding that the unemployment rate remains at a low level and that the labor market conditions are “solid.” It also described the inflation as “somewhat elevated.”

“The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run,” FOMC noted. “In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.”

Additionally, Fed chair Jerome Powell said that the U.S. central bank will have to see “real progress on inflation or some weakness in the labor market” before considering further rate adjustments.

The Fed’s decision to keep the interest rates unchanged caused a brief slide in the stock market that was diminished in the following hours. Benchmark S&P 500 was down by 0.72% at one point before closing down by 24.57 points or 0.41%.

The post Fed Unanimously Decides to Keep Its Interest Rates Intact appeared first on theprimarymarket.com.

This was the Fed’s third consecutive rate cut in 2024 and brought the benchmark interest rate to a range of 4.25% to 4.5%. The Federal Open Market Committee made the cut with a split vote with Cleveland Fed president Beth Hammack objecting to the decision.

Hammack’s objection was the second dissent in the current rate-cutting cycle. Governor Michelle Bowman previously voted no for the 50 basis points cut in September, arguing for a  25 basis points cut at the time.

“Today was a closer call, but we decided it was the right call,” Federal Reserve Chair Jerome Powell said at a press conference on Wednesday. “It was the best decision to foster achievement of both of our goals, maximum employment and price stability. “

According to Powell, the Fed is “still on track” to make cuts in 2025 but noted that the officials will need to see further inflation cooling for that to be the case. He added that he doesn’t see any rate hikes happening next year.

The Federal Open Market Committee’s so-called “dot plot,” which provides insights into individual members’ future rate expectations, has shown that only two quarter percentage cuts are likely to happen in 2025. Back in September, the “dot plot” indicated expectations of four rate cuts.

The post Fed Cuts Interest Rates by 25 Basis Points, Projects Slower Pace in 2025 appeared first on theprimarymarket.com.

The quarter percentage point cut brings the Fed’s benchmark rate in the range of 4.50% to 4.75%. The move follows a 50 basis points deduction from September.

According to Fed Chairman Jerome Powell, policymakers will continue to monitor the economic data in order to determine future moves. However, he reiterated that he is content with the way the U.S. economy is looking at the moment.

“This further recalibration of our policy stance will help maintain the strength of the economy and the labor market and will continue to enable further progress on inflation as we move toward a more neutral stance over time,” Fed chairman Jerome Powell said. “We think that the economy, and we think our policies, are both in a very good place, a very good place.”

Economists have mostly expected the Fed to further slash the interest rate at their latest meeting despite the aggressive move in September. They also predict that another cut will be made in December before a likely pause in January to get a better sense of the economic landscape.

The post Federal Reserve Cuts Interest Rates By Another 25 Basis Points appeared first on theprimarymarket.com.

Bloomberg Economics weighed in on the ECB’s latest policy decision, claiming: “The ECB will lower borrowing costs by 25 basis points in October and again in December. After that we see quarterly moves as policymakers feel their way to neutral.”

A Bloomberg survey of a range of economists found that there is a broad expectation that the ECB will accelerate its policy easing as a means of bringing borrowing costs down to a level that no longer stifles the economy by the end of 2025. In China, the economy appears to be continually underperforming its target, however, in the UK, inflation appears to be slowing towards the 2% mark.

The post ECB Considering Interest Rate Cut to Drive Global Monetary Easing appeared first on theprimarymarket.com.

The Federal Open Market Committee (FOMC) was widely expected to make cuts on Wednesday, with the traders being split on whether the rate will be lowered by 25 basis points or 50 basis points. Both moves had their pros and cons according to experts, with lower cuts threatening to increase the risk of recession while deeper cuts possibly contributed to higher inflation.

In the end, the monetary policymakers opted for a more aggressive approach, bringing the rate to the 4.75%-5% range, although the decision wasn’t unanimous. Fed governor Michelle Bowman dissented, arguing that a 25 basis points cut would be more appropriate.

“The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance,” the Fed said in a statement released after the meeting.

The Fed also shared a so-called dot plot, which indicates that another 50 basis points cut is coming by the end of the year, further full percentage points of cuts in 2025, and a half percentage point cut in 2026. This would bring the interest rate to 2.9%.

Still, it isn’t guaranteed that this will be the approach that the Federal Reserve ends up taking.

“I think we’re going to go carefully meeting by meeting, and make our decisions as we go,” Fed chair Jerome Powell said during press conference after the meeting.

The post Fed Lowers Rates By 50 Basis Points, Signals 2 More Cuts in 2024 appeared first on theprimarymarket.com.

In addition to being the smallest rise since April 2021, this CPI reading sees inflation approaching the 2% mark, which is the Fed’s target rate. “I don’t think there’s really any debate that the Fed is cutting in September,” Kelsey Berro from JPMorgan Chase observed, with Citigroup’s global chief economist Nathan Sheets supporting this stance. Fed President Jerome Powell also acknowledged that a rate cut in September is “on the table” depending on what the data suggests.

The CME FedWatch Tool indicated that traders believe that there is a 100% chance that a rate cut in September will be implemented to some extent. The odds of a 50 basis point cut as well as a 25 basis point cut are both 50/50. More clarity on the Fed’s trajectory is expected upon the release of the central bank’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, due on August 30.

The post Federal Reserve Expected to Cut Rates Following Positive Inflation Reading appeared first on theprimarymarket.com.

Core inflation, which excludes alcohol, energy, food, and tobacco, declined 3.5% from June while rising 3.3% for the year to date. Services sector inflation, which is closely scrutinized by the central bank policymakers, fell from 5.7% to 5.2% in July compared to the previous month.

“Inflation undershooting the Bank of England’s expectations will be seen as a positive sign that price pressures are continuing to normalize for households and businesses,” Martin Sartorius of CBI observed. Money markets are now pricing a 42% chance that the Bank of England will cut its interest rate to 4.75% at its policy meeting next month. This is a rise from the previous 36% probability of an interest rate cut.

The post UK Inflation Rises Less Than Expected appeared first on theprimarymarket.com.

Apple, Amazon, Meta, and Microsoft are all amongst the Big Tech firms that are still to announce their earnings, with such corporate earnings set to no doubt have a major effect on investor outlook.

Aside from corporate earnings, investors will no doubt be anticipating the latest interest rate policy adjustments of the Federal Reserve, which is set to announce its decision on Wednesday. The central bank’s decision is expected to be largely influenced by the latest personal consumption expenditures (PCE) index, the Fed’s preferred inflation gauge.

Core PCE rose 2.6% on an annual basis. While higher than economists’ expectations, it rose at its slowest pace in the past three years, thereby giving the central bank confidence that inflation is cooling, moving toward the Fed’s 2% target. Another crucial area that the Fed is monitoring is the labor market. With the latest monthly jobs report expected to show labor market stabilization, the Fed is largely expected to consider an interest rate cut by the time its September meeting arrives.

The post Investors Brace for Busy Earnings Week With Fed Decision Incoming appeared first on theprimarymarket.com.

Recent data has instilled confidence in Fed Chair Jerome Powell that the US economic trajectory is a positive one, particularly as inflation seems to be cooling to the Fed’s 2% target. Still, in order to introduce rate cuts, the Fed will look for two objectives to be met, namely stable prices and maximum employment.

In order to provide the Fed with confidence on the employment front, next Friday’s monthly jobs report will need to come in strong. Nonfarm payrolls are expected to come in at 178,000, while the unemployment rate is forecasted to remain steady at 4.1%. Should such figures indeed be realized, this would provide the good workforce health that the Fed is looking for in order to consider introducing an interest rate cut over the near term.

The post Federal Reserve Weights Rate Cuts Amid Moderate Job Growth appeared first on theprimarymarket.com.

Investor disappointment following the latest round of corporate earnings was largely wiped out following the release of the personal consumption expenditure index (PCE), the Federal Reserve’s preferred inflation gauge. While prices rose higher than economists expected, they still rose at their slowest rate over the past three years. This has given the Federal Reserve confidence that inflation is heading toward its 2% target.

This resurgence in investor confidence has resulted in a boost in small cap investment. “The prospect for interest-rate cuts has helped underpin the surge-like move into smaller names,” Quincy Krosby at LPL Financial observed. “Still, there has been a prevailing concern that because small caps require a solid economic landscape, a weaker US economy could easily hinder investor interest.”

Economists surveyed by Bloomberg appear to be of the opinion that the Federal Reserve will indicate within the next week its intention to cut interest rates at its next policy meeting. A quarter-point reduction is expected for September.

The post Stocks Close Week Higher Amid Bets on Interest Rate Cuts appeared first on theprimarymarket.com.

The Federal Open Market Committee (FOMC) unanimously voted to pause further rate cuts at the conclusion of its two-day meeting in Washington, D.C. The move was somewhat expected, as policymakers previously indicated the intention to take a patient approach to interest rate changes in 2025.

In a statement released following the meeting, FOMC said that the economic activity in the country continued to expand “solid pace,” while adding that the unemployment rate remains at a low level and that the labor market conditions are “solid.” It also described the inflation as “somewhat elevated.”

“The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run,” FOMC noted. “In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.”

Additionally, Fed chair Jerome Powell said that the U.S. central bank will have to see “real progress on inflation or some weakness in the labor market” before considering further rate adjustments.

The Fed’s decision to keep the interest rates unchanged caused a brief slide in the stock market that was diminished in the following hours. Benchmark S&P 500 was down by 0.72% at one point before closing down by 24.57 points or 0.41%.

The post Fed Unanimously Decides to Keep Its Interest Rates Intact appeared first on theprimarymarket.com.

This was the Fed’s third consecutive rate cut in 2024 and brought the benchmark interest rate to a range of 4.25% to 4.5%. The Federal Open Market Committee made the cut with a split vote with Cleveland Fed president Beth Hammack objecting to the decision.

Hammack’s objection was the second dissent in the current rate-cutting cycle. Governor Michelle Bowman previously voted no for the 50 basis points cut in September, arguing for a  25 basis points cut at the time.

“Today was a closer call, but we decided it was the right call,” Federal Reserve Chair Jerome Powell said at a press conference on Wednesday. “It was the best decision to foster achievement of both of our goals, maximum employment and price stability. “

According to Powell, the Fed is “still on track” to make cuts in 2025 but noted that the officials will need to see further inflation cooling for that to be the case. He added that he doesn’t see any rate hikes happening next year.

The Federal Open Market Committee’s so-called “dot plot,” which provides insights into individual members’ future rate expectations, has shown that only two quarter percentage cuts are likely to happen in 2025. Back in September, the “dot plot” indicated expectations of four rate cuts.

The post Fed Cuts Interest Rates by 25 Basis Points, Projects Slower Pace in 2025 appeared first on theprimarymarket.com.

The quarter percentage point cut brings the Fed’s benchmark rate in the range of 4.50% to 4.75%. The move follows a 50 basis points deduction from September.

According to Fed Chairman Jerome Powell, policymakers will continue to monitor the economic data in order to determine future moves. However, he reiterated that he is content with the way the U.S. economy is looking at the moment.

“This further recalibration of our policy stance will help maintain the strength of the economy and the labor market and will continue to enable further progress on inflation as we move toward a more neutral stance over time,” Fed chairman Jerome Powell said. “We think that the economy, and we think our policies, are both in a very good place, a very good place.”

Economists have mostly expected the Fed to further slash the interest rate at their latest meeting despite the aggressive move in September. They also predict that another cut will be made in December before a likely pause in January to get a better sense of the economic landscape.

The post Federal Reserve Cuts Interest Rates By Another 25 Basis Points appeared first on theprimarymarket.com.

Bloomberg Economics weighed in on the ECB’s latest policy decision, claiming: “The ECB will lower borrowing costs by 25 basis points in October and again in December. After that we see quarterly moves as policymakers feel their way to neutral.”

A Bloomberg survey of a range of economists found that there is a broad expectation that the ECB will accelerate its policy easing as a means of bringing borrowing costs down to a level that no longer stifles the economy by the end of 2025. In China, the economy appears to be continually underperforming its target, however, in the UK, inflation appears to be slowing towards the 2% mark.

The post ECB Considering Interest Rate Cut to Drive Global Monetary Easing appeared first on theprimarymarket.com.

The Federal Open Market Committee (FOMC) was widely expected to make cuts on Wednesday, with the traders being split on whether the rate will be lowered by 25 basis points or 50 basis points. Both moves had their pros and cons according to experts, with lower cuts threatening to increase the risk of recession while deeper cuts possibly contributed to higher inflation.

In the end, the monetary policymakers opted for a more aggressive approach, bringing the rate to the 4.75%-5% range, although the decision wasn’t unanimous. Fed governor Michelle Bowman dissented, arguing that a 25 basis points cut would be more appropriate.

“The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance,” the Fed said in a statement released after the meeting.

The Fed also shared a so-called dot plot, which indicates that another 50 basis points cut is coming by the end of the year, further full percentage points of cuts in 2025, and a half percentage point cut in 2026. This would bring the interest rate to 2.9%.

Still, it isn’t guaranteed that this will be the approach that the Federal Reserve ends up taking.

“I think we’re going to go carefully meeting by meeting, and make our decisions as we go,” Fed chair Jerome Powell said during press conference after the meeting.

The post Fed Lowers Rates By 50 Basis Points, Signals 2 More Cuts in 2024 appeared first on theprimarymarket.com.

In addition to being the smallest rise since April 2021, this CPI reading sees inflation approaching the 2% mark, which is the Fed’s target rate. “I don’t think there’s really any debate that the Fed is cutting in September,” Kelsey Berro from JPMorgan Chase observed, with Citigroup’s global chief economist Nathan Sheets supporting this stance. Fed President Jerome Powell also acknowledged that a rate cut in September is “on the table” depending on what the data suggests.

The CME FedWatch Tool indicated that traders believe that there is a 100% chance that a rate cut in September will be implemented to some extent. The odds of a 50 basis point cut as well as a 25 basis point cut are both 50/50. More clarity on the Fed’s trajectory is expected upon the release of the central bank’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, due on August 30.

The post Federal Reserve Expected to Cut Rates Following Positive Inflation Reading appeared first on theprimarymarket.com.

Core inflation, which excludes alcohol, energy, food, and tobacco, declined 3.5% from June while rising 3.3% for the year to date. Services sector inflation, which is closely scrutinized by the central bank policymakers, fell from 5.7% to 5.2% in July compared to the previous month.

“Inflation undershooting the Bank of England’s expectations will be seen as a positive sign that price pressures are continuing to normalize for households and businesses,” Martin Sartorius of CBI observed. Money markets are now pricing a 42% chance that the Bank of England will cut its interest rate to 4.75% at its policy meeting next month. This is a rise from the previous 36% probability of an interest rate cut.

The post UK Inflation Rises Less Than Expected appeared first on theprimarymarket.com.

Apple, Amazon, Meta, and Microsoft are all amongst the Big Tech firms that are still to announce their earnings, with such corporate earnings set to no doubt have a major effect on investor outlook.

Aside from corporate earnings, investors will no doubt be anticipating the latest interest rate policy adjustments of the Federal Reserve, which is set to announce its decision on Wednesday. The central bank’s decision is expected to be largely influenced by the latest personal consumption expenditures (PCE) index, the Fed’s preferred inflation gauge.

Core PCE rose 2.6% on an annual basis. While higher than economists’ expectations, it rose at its slowest pace in the past three years, thereby giving the central bank confidence that inflation is cooling, moving toward the Fed’s 2% target. Another crucial area that the Fed is monitoring is the labor market. With the latest monthly jobs report expected to show labor market stabilization, the Fed is largely expected to consider an interest rate cut by the time its September meeting arrives.

The post Investors Brace for Busy Earnings Week With Fed Decision Incoming appeared first on theprimarymarket.com.

Recent data has instilled confidence in Fed Chair Jerome Powell that the US economic trajectory is a positive one, particularly as inflation seems to be cooling to the Fed’s 2% target. Still, in order to introduce rate cuts, the Fed will look for two objectives to be met, namely stable prices and maximum employment.

In order to provide the Fed with confidence on the employment front, next Friday’s monthly jobs report will need to come in strong. Nonfarm payrolls are expected to come in at 178,000, while the unemployment rate is forecasted to remain steady at 4.1%. Should such figures indeed be realized, this would provide the good workforce health that the Fed is looking for in order to consider introducing an interest rate cut over the near term.

The post Federal Reserve Weights Rate Cuts Amid Moderate Job Growth appeared first on theprimarymarket.com.

Investor disappointment following the latest round of corporate earnings was largely wiped out following the release of the personal consumption expenditure index (PCE), the Federal Reserve’s preferred inflation gauge. While prices rose higher than economists expected, they still rose at their slowest rate over the past three years. This has given the Federal Reserve confidence that inflation is heading toward its 2% target.

This resurgence in investor confidence has resulted in a boost in small cap investment. “The prospect for interest-rate cuts has helped underpin the surge-like move into smaller names,” Quincy Krosby at LPL Financial observed. “Still, there has been a prevailing concern that because small caps require a solid economic landscape, a weaker US economy could easily hinder investor interest.”

Economists surveyed by Bloomberg appear to be of the opinion that the Federal Reserve will indicate within the next week its intention to cut interest rates at its next policy meeting. A quarter-point reduction is expected for September.

The post Stocks Close Week Higher Amid Bets on Interest Rate Cuts appeared first on theprimarymarket.com.