JPMorgan top economist says the Fed should cut rates by a half point this month

Published On Sep 5, 2024, 1:14 PM

Michael Feroli, the chief U.S. economist at JPMorgan, has suggested the Federal Reserve should cut interest rates by 50 basis points at its upcoming meeting on September 17-18. He argues that returning to a neutral policy is critical, particularly given the recent weak private payrolls growth and rising unemployment. Currently, traders see a 39% chance of this substantial rate cut, which would lower the target range from 5.25%-5.50% to 4.75%-5.00%. Feroli believes that if the Fed waits until inflation is back down to 2%, they may be acting too late, given the current economic indicators that point to potential risks in both inflation and employment.