Recent weeks have been punctuated by a number of positive developments for the U.S. economy, the first of which was the significant upward revision to historical data on household disposable income. However, this was partially offset by weaker recent momentum, NBC’s Jocelyn Paquet notes.
Fed to continue cutting its key rate at a gradual pace
“In reality, however, the future path of household income will depend first and foremost on the evolution of the labour market. Which brings us to the second piece of good news of recent weeks: September’s solid employment figures.”
“As for the third piece of good news, the Federal Reserve has not only decided to begin its cycle of monetary easing with a jumbo 50 basis point cut, but has also underlined its willingness to cut benchmark rates further in the months ahead, if the latest edition of its dot plot is anything to go by.”
“Assuming that inflation remains under control and that the U.S. elections do not cause too much disruption, we expect the Fed to continue cutting its key rate at a gradual pace over the coming months. This will probably not prevent growth from slowing significantly by the middle of next year, although we do not expect the economy to contract. Following this scenario, we anticipate growth of 2.6% and 1.2% in 2024 and 2025, respectively. This is better than the figures of 2.5% and 0.9% we presented last month.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
