Federal Reserve meet in focus: Will the Fed give clear signals on rate cuts? Top experts weigh in
US inflation rises to 3.2%, dampens hope of Fed's interest-rate cut until June However, Powell in his comments to US lawmakers earlier this month said the central bank expects to reduce its benchmark interest rate later this year even though the continued progress on lowering inflation to the two per cent target “is not assured". Read more: US Fed signals rate cuts in 2024; Powell says progress towards 2% inflation target ‘not assured’ Mint talked to several analysts on what they expect from the Fed policy outcome this time and how it can impact market sentiment.
Here's what they said: The US Fed is widely expected to keep its key lending rate unchanged again on Wednesday, as policymakers continue dialogue over when to start rate cuts. The US is seeing a small uptick in the pace of monthly inflation and at the same time, the unemployment rate has remained low, wage growth has reduced, and economic growth for the final quarter of 2023 came in above expectations -- all indications that the US economy remains in good shape despite higher rates.
After two days of discussions, the US Fed will publish an updated summary of economic projections (SEP) alongside its rate decision on Wednesday, which will include policymakers' views of where they expect interest rates to be at the end of this year. The March update published Wednesday is unlikely to show a significant shift, although there remains a chance that the policymakers could reduce the number of cuts to two (from the earlier three) they expect to see this year.
Any outcome different from the above could shake up the global equity markets. Also Read: US inflation prints dent rate cut hopes; what will move the market now? Here's what 5 experts say The Fed is unlikely to cut
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