Skip to main content

Fed's intransigence typical ahead of a turning point

The Fed’s reluctance to acknowledge that it will need to begin cutting its policy rate soon – to prevent a run-up in real rates – was predictable enough based on its intransigence ahead of previous turning points in the policy cycle. We continue to expect that – with core PCE inflation normalising much more quickly than Fed officials are willing to admit – the first rate cut will probably come at the March meeting next year. We then expect the Fed to cut by 25bp at every meeting from March onwards, for a cumulative decline of 175bp in 2024.

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services

Get access