FED EXPECTS FEWER RATE CUTTING IN 2025
#Fed ’s latest dot plot projects fewer rate cuts than central bankers had previously expected in September. Fed officials now expect the federal funds rate to finish 2025 at 3.9%, two quarter-points less than the 3.4% rate cut expected in September. Fed officials have also become increasingly concerned that inflation will remain stubborn next year. The median official expects 12-month PCE inflation and core PCE inflation to both finish 2025 at 2.5%, up from September’s estimates of 2.1% and 2.2%. The Fed also expects unemployment next year to be slightly lower than its previous guidance: 4.3%, compared with 4.4% three months ago.
