As the Federal Reserve prepares for its July FOMC meeting on Today, most expect interest rates to stay unchanged. However, there’s speculation about a potential rate cut in September. Here’s a summary of what might happen and its implications.
July Meeting: What’s Likely?
The Fed is expected to keep interest rates steady in July. The CME FedWatch Tool indicates a 95.9% chance that rates will remain unchanged at this meeting.
This decision reflects the Fed’s cautious stance amid mixed economic signals. Yet, attention is turning to September, with an 87.7% chance of a 25 basis point rate cut anticipated.
Jerome Powell’s Role
Federal Reserve Chair Jerome Powell’s upcoming speech is crucial. Many expect him to hint at a possible rate cut. The Jackson Hole Symposium at the end of August might provide more clarity on Powell’s stance.
By September, the Fed will have additional data on inflation and the economy. This will help determine if a rate cut is appropriate.
Key Discussions
Inside the FOMC, debates will focus on how proactive the Fed should be with rate changes. Powell’s view on shifting towards rate cuts to ensure economic stability will be a key topic.
As meeting approaches, Powell’s comments and the data leading up to September will be closely watched for signs of future policy adjustments.