With Powell’s Fed ready to cut rates, a new era of cheap credit beckons
The Fed chairman could use his press conference to preach patience and reprimand policy speculators if the decision is a more modest quarter-point cut
THE US stock market has been stamping its proverbial feet for more than a year now as it demands an interest rate cut from the central bank.
And yet, when Jerome Powell and the US Federal Reserve present the gift, as expected, wrapped in a big red bow on Wednesday (Sep 18), the multi-trillion-dollar spoiled child might still throw a massive tantrum.
The Fed is very likely to cut interest rates by a quarter-of-a-percentage point from the current level of between 5.25 and 5.5 per cent, and promise more cuts in the months to come, Wall Street strategists say. Unfortunately, the markets are positioned for a half-a-percentage point cut.
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