🟡 50 basis point interest rate cut: The Fed has decided to lower interest rates to 4.75%-5.00% to support the economy and address potential risks due to slowing growth.
🟡 Internal debate: Some FOMC members, including Governor Bowman, argued that a rate cut should be more cautious, favoring a 25 basis point cut instead of 50.
🟡 Forecast for 2024: Interest rates are expected to continue to fall, with the new target being 4.4% instead of 5.1% as before. This suggests that the Fed will likely make smaller cuts in the coming time.
🟡 Focus on economic data: The Fed will continue to closely monitor employment and inflation data before making further interest rate decisions.
🟡 Economic growth concerns: Several FOMC members stressed that the economy still faces many challenges, especially due to the slow impact from previous interest rate hikes.
🟡 Inflationary pressures remain: Although inflation has declined, the Fed is still concerned about the risk of inflation returning if interest rates are cut too quickly or not well controlled.
🟡 Views on easing rates are divided: Some FOMC members favor a sharp cut to stimulate the economy, while others warn this could cause imbalances if not managed carefully.
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