Why Wall Street is on board with bigger rate cuts in Q4

Published On Sep 22, 2024, 11:00 AM

Wall Street is currently anticipating larger interest rate cuts from the Federal Reserve in the fourth quarter of 2024, driven by cooling inflation and a desire to support economic activity. Traders are pricing in more aggressive cuts than the Fed has indicated, reflecting growing optimism in the market. The S&P 500 has reached new highs as investors respond positively to the potential for a 50 basis point cut at the next meeting on November 7. Analysts believe that if inflation trends continue downward, the Fed will have room to reduce interest rates further, which could bolster spending and investment in the economy.