The Federal Reserve will announce its interest rate decision and a summary of economic expectations at 2:00 next Thursday. Analysts are divided on the extent of the rate cut.

The Fed is scheduled to release its interest rate decision and a summary of economic expectations at 2 a.m. next Thursday. Traders are pricing in an almost equal chance of a 25 basis point and 50 basis point rate cut from the Fed next week. The changing bets reflect one of the key questions facing markets today: Will the Fed aggressively cut rates to stem the slack in the labor market, or take a slower pace of cuts to stay on the sidelines. Federal funds rate futures are pricing in a rate cut of more than two percentage points over the next 12 months, a scenario rarely seen outside of a recession.

James St. Aubin, chief investment officer of Ocean Park Asset Management, which manages $5.3 billion in assets, said, "With the S&P 500 near record highs and credit spreads narrowing, it seems that starting a rate cut cycle with a big rate cut will only happen if the Fed knows something that others don't know. I think a 50 basis point rate cut may do more harm than good in terms of market sentiment." In any case, even if the Fed cuts interest rates by 25 basis points next week, as long as Powell does not oppose the expectation of a 50 basis point cut once or even twice in the last two meetings of the year, the meeting may be regarded as a dovish rate cut. (Jinshi) #crypto2023A