The Federal Reserve Bank of the United States is expected to cut interest rates for the second time in a decade Today, but Fed Chairman Jerome Powell is unlikely to deliver the message markets want to hear on plans for future action.
“He’ll underwhelm everyone and not overwhelm anyone,” said Diane Swonk, chief economist at Grant Thornton. She expects a cut of 25 basis point, taking the fed funds target rate range to 1.75 to 2.0%, following the last quarter-point cut on July 31.
At the Fed’s last meeting, Powell rocked markets, sending stocks lower and bond yields higher when he described the rate cut as a “midcycle adjustment,” meaning it was not part of a larger rate cutting cycle.
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