A cautious Fed on track for one last 2024 cut followed by a 'slowing down' in 2025

Published On Dec 11, 2024, 9:48 AM

The Federal Reserve is expected to announce another interest rate cut in December 2024, but there is a cautionary stance as inflation remains persistent. Despite the upcoming cut, forecasts suggest that the Fed may slow the pace of future cuts in 2025 due to ongoing pricing pressures. This cautious approach stems from inflation that has not shown significant improvement, even as central bank officials express optimism about a gradual decline in rates over the long term.

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The expected interest rate cut may lead to a temporary boost for growth-sensitive sectors as borrowing costs decrease. However, a slowing down in the frequency and magnitude of future cuts could stabilize market volatility.

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