Jerome Powell reported this Wednesday that the Federal Reserve expects to cut interest rates during next year 2024. The president of the economic organization made this announcement just after it was announced that, for third time in a row, he maintained this percentage exactly the same as in previous months.
A clear sign that the economic situation is improving at the moment, is in part due to the drop in inflation: "Inflation keeps coming down, the labor market keeps getting back into balance and, it’s so far, so good," Powell said during a press conference held in Washington DC.
Jerome Powell assures that "the path is uncertain"
The interest rate decision comes, ABC News reports, just a day after the Government published an economic report showing that price rises slowed slightly throughout November. This is another sign that interest rates could be reduced over the next year although, Powell says, "the path is uncertain":
Inflation has eased from its highs and this has come without the significant increase in unemployment - that’s very good news. But inflation is too high, ongoing progress in bringing it down is not assured, and the path is uncertain.
For this reason, the president of the Federal Reserve explained in statements reported by CNN, "no one is declaring victory" yet, since doing so would be "premature" without knowing how the markets will continue to behave. However, he said, economic officials are already addressing possible interest rate cuts :
The question of when will it become appropriate to begin dialing back policy, that begins to come into view and is clearly a topic of discussion now in the world and was also a discussion for us at our meeting today.
The Federal Reserve is the first world bank to meet AP reports that both the European Central Bank and the Bank of England will hold their meetings this Thursday and, like the US bank, could also announce that they are keeping their interest rates unchanged.
