US Fed to unveil third policy decision for 2024 today: JPMorgan, Goldman Sachs expect first rate cut in July; here's why
Follow US Fed Meeting Outcome Live Updates: Powell-led FOMC to announce policy decision today, likely to hold key rates steady The US Federal Reserve will announce its third policy decision for 2024 later today. The US central bank has lifted its key lending rate to a 23-year high of between 5.25 and 5.50 per cent as part of a long-running battle to bring high inflation to its two per cent target.
Fed policymakers will not be updating their quarterly economic projections at this week's meeting, so any fresh guidance rests on the policy statement itself and Fed chair Powell's press conference. In its second policy for 2024 announced on March 20, the Federal Open Market Committee (FOMC) had said that it expects three rate cuts in 2024 despite sticky inflation.
The rate-setting panel had unanimously voted to hold the policy rate at the two-decade high mark, but said it "does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward two per cent." FOMC members also left the median projection for interest rates at end-2024 at the midpoint between 4.50 and 4.75. This means they still expect 0.75 percentage points of cuts before the end of the year, which would likely translate into three 0.25 percentage point cuts.
However, since then, key US macro data including US inflation and US gross domestic product (GDP) have beaten Wall Street expectations. The economic data print will likely push the US central bank to focus on its hawkish stance and wait until inflation levels comes under its fixed target before it can touch the current level of interest rates.Milestone Alert!
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