- Fed cuts rates for the 3rd time this year
- Central bank signals a pause in easing
- Limited market reaction so far
The FOMC decided to cut interest rates for the third time this year in line with market expectations. The Fed maintains that the US economy keeps doing reasonably well and the cuts are “insurance” against global headwinds. That had the FOMC to alert the statement slightly, removing a pledge to “act as appropriate” from the statement which is seen as a pause in monetary easing.
September statement:
October statement:

This could be seen as slightly hawkish and this has been reinforced by the Powell conference. Fed president argued that the monetary policy is in the “good place” and for as long as the reality confirms Fed’s expectations, interest rate would remain unchanged.
Wall Street takes the Fed’s decision calmly, although the pause in rate cuts certainly is not a good news to the bulls. Do notice that on 2 previous occasions the Fed failed to maintain US500 highs despite cutting rates AND promising more cuts. One needs to wonder if the rally could be sustained despite no more cuts on the horizon. (Source: xStation5)
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