Key Points
The US Federal Reserve voted Wednesday to leave interest rates unchanged for the fourth straight meeting, while indicating it was moving toward future cuts -- but probably not before May at the earliest.g)..
But it added that the rate-setting Federal Open Market Committee (FOMC) is unlikely to start cutting interest rates "until it has gained greater confidence that inflation is moving sustainably" toward two percent..
. Powell's remarks "reinforce our long-standing view that the Fed will start cutting rates in May," EY chief economist Gregory Daco wrote in an investor note after the press conference. ..
In its December rate meeting, the Fed raised its economic outlook for the year ahead, and signaled it expects as many as three quarter-percentage-point rate cuts in 2024, sparking optimism in financial markets that the central bank could cut rates as soon as March..
They are much more confident of a cut the following meeting, assigning a greater-than-90 percent probability that the Fed will have a lower key lending rate by May 1 than it does now..
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