Fed ponders rate decision: More cuts ahead?
The Fed’s next rate decision will be announced on Wednesday, but is another cut really necessary? Most economists are projecting a cut of 25 basis points but, that’s not such a sure thing.
The Fed has cut rates by 300 points since September. Go Speed Racer go! This is the fastest drop (percentage wise) ever and now it may be time to pump the brakes.
There are lots of conflicting signals to consider. GDP data for the first quarter is likely to confirm the country is not technically in a recession. But, the dollar is down and inflation as viewed by the average consumer is up.
Speaking of the average consumer, banks and mortgage lenders are not passing through much of the interest rate savings from the Fed’s previous cuts. So, even if another cut is announced, don’t expect much relief.
The world is watching and the Fed has a tough call to make. Until then, be on the lookout for those early rebate checks ;)
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POSTED IN: Economy, Federal Reserve, Market, Uncategorized
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