The Least Predictable Meeting in Years Happens Today When the Fed Will Be Cutting Rates for the First Time Since 2020
Today’s FOMC meeting at 2pm EST is one that has investors, economists and market enthusiasts on the edge of their seats. While it is 100% certain a rate cut is coming, the sizing of the cut is what is unpredictable.
Most Street economists are continuing to hold their estimated cut at 25bps however, the 50bp cut odds have risen over the past few days while the market remains sharply divided on the magnitude of the Feds cut, as the 2pm deadline approaches. This will be the first rate cut since March 2020, causing many to not know what to expect.
According to FactSet, most economists’ previews expect the new dot plot to show 75bps of cuts for 2024 though the market is continuing to price ~110 in cuts by year-end and four to five 2025 rate cuts to bring fed funds rate to ~3.0%, though with Fed officials offering fairly wide range of forecasts. This meeting should not only provide near-term insight on rates but should give additionally color on future cuts and adjustments to economic estimates.
