The Federal Reserve's decision to cut interest rates by 50 basis points came as quite a surprise to the market, even though the market gave a 65% probability for such a move. In addition to this decision, the Fed is lowering its interest rate forecasts quite sharply for 2024 and beyond:
- The Fed sees 2 more rate cuts this year, with a median of 4.4% (previously 5.1%)
- The Fed sees 4-5 cuts next year, with a median of 3.4% (previously 4.1%)
- It sees 2.9% in 2026, and sees the same in 2027
- Fed cuts inflation outlook quite a bit for this year: PCE at 2.3% and core PCE at 2.6%
- The Fed also sees the unemployment rate higher to 4.4% in 2024, while it sees 4.2% thereafter. Fed sees no collapse in labor market
- GDP forecast points to 2.0% in 2024 and beyond, indicating a soft landing.
Source: the Fed
The US500 rises momentarily to 5670 points after the Fed's decision, a test of yesterday's local peaks and early September levels. Later, however, the increases were somewhat reduced in anticipation of Powell's conference at 7:30 PM BST For the time being, the decision is received positively in the market, given the stable economic outlook and the willingness to make strong cuts, which means a win against inflation and the willingness to fight for a stronger labor market. If Powell solidifies the market's expectation of a strong economy and the need for cuts due to the end of the fight against inflation, the US500 could head towards the 5700 point level. 
هل يدخل السوق الأمريكي مرحلة تصحيح؟
وول ستريت تواصل مكاسبها؛ و US100 ينتعش بأكثر من 1% 📈
ملخص السوق: نوفو نورديسك تقفز بأكثر من 7% 🚀
فوز حزب تاكايتشي في الانتخابات اليابانية – هل يعود القلق بشأن الديون؟ 💰✂️
