BUSINESS-ECONOMY
After cutting rates for two consecutive times, Federal Reserve officials eased rates again this month. However, the Fed is forecast to reduce the number of rate cuts next year. That is according to analysts polled by Bloomberg News. At their meeting on December 17–18, the Fed is likely to announce another quarter-point cut, bringing the key rate down to a range of 4.25 per cent to 4.50 per cent. That would make rates a full percentage point lower. The majority of analysts foresee just three cuts in 2025. This is due to concerns about inflation. As a result, rate cuts are expected to slow down next year by more than authorities projected three months ago. Dennis Shen, an economist with scope ratings, said, “The case for further US rate cuts beyond this month has decreased meaningfully.” Shen added, “Inflation has remained sticky, the economy and financial markets are overheating, the slight rise in unemployment earlier this year has reversed, and the incoming trump administration threatens more near-term inflation risk.” Economists predict the Fed will pause the rate cuts at its January meeting and cut again in March. June and September 2025 will see the other two rate cuts. Not long ago, many analysts predicted a more aggressive path of rate cuts in 2025, driven by concerns about a weaker labour market. However, predictions for the US economy and monetary policy have changed significantly. (With inputs from the agencies) A journalist, writing for the WION Business desk. Bringing you insightful business news with a touch of creativity and simplicity. Find me on Instagram as Zihvee, tr None
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