Despite the fact that the latest economic indicators from the United States turned out to be better than forecasts, the market is still not sure by what amount the Fed will cut interest rates in September. And although the probability of a 0.50% decline is estimated at only 25%, investors will closely follow Chairman Powell's statements at the economic symposium in Jackson Hole, trying to understand by what amount the Fed will cut rates. The annual conference, which will be held from August 22 to 24, will discuss various opinions on how quickly the Fed's policy will affect the economy and how sensitive it is to changes in interest rates. Morgan Stanley analysts believe that the majority of FOMC members are likely to support a 0.25% rate cut, given the current economic situation. They forecast an increase in core personal consumption expenditure (PCE) inflation in July by 0.16% on a monthly basis, which would be equivalent to an annual rate of 1.9%. However, analysts warn that a 0.50% rate cut may cause concern to investors, as it may be perceived as a sign of serious problems in the economy.
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