When will Fed cut rates? As US economy flexes its muscles, maybe later or not at all

abcnews.go.com:

Ever since the Federal Reserve signaled last fall that it was likely done raising interest rates, Wall Street traders, economists, would-be homeowners — pretty much everyone — began obsessing over a single question: When will the Fed start cutting rates

WASHINGTON — Ever since the Federal Reserve signaled last fall that it was likely done raising interest rates, Wall Street traders, economists, car buyers, would-be homeowners — pretty much everyone — began obsessing over a single question: When will the Fed start cutting rates?

But now, with the U.S. economy showing surprising vigor, a different question has arisen: Will the central bank really cut rates three times this year, as the Fed itself has predicted — or even cut at all? The Fed typically cuts only when the economy appears to be weakening and needs help.

Lower interest rates would reduce borrowing costs for homes, cars and other major purchases and probably fuel higher stock prices, all of which could help accelerate growth. An even more robust economy might also benefit President Joe Biden's re-election campaign.

Friday's blockbuster jobs report for March reinforced the notion that the economy is managing quite nicely on its own. The government said employers added a huge burst of jobs last month — more than 300,000 — and the unemployment rate dipped to a low 3.8% from 3.9%.

Some analysts responded by arguing that it's clear the last thing the economy needs now is more stimulus from lower rates.

“If the data is too strong, then why are we cutting?” asked Torsten Slok, chief economist at Apollo Global Management, a wealth management firm. “I think the Fed will not cut rates this year. Higher (rates) for longer is the answer.”

In March, the central bank's