{"id":2013959,"date":"2023-08-28T05:17:02","date_gmt":"2023-08-28T09:17:02","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/when-could-the-fed-start-cutting-interest-rates\/"},"modified":"2023-08-28T05:19:35","modified_gmt":"2023-08-28T09:19:35","slug":"when-could-the-fed-start-cutting-interest-rates","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/when-could-the-fed-start-cutting-interest-rates\/","title":{"rendered":"When might the Fed begin reducing interest rates?"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">16<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fwhen-could-the-fed-start-cutting-interest-rates%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2013959&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>The\u2064 Federal Reserve&#8217;s Interest Rate Hike: What to Expect<\/h2>\n<p>The Federal Reserve has\u200c been steadily raising interest rates \u200dfor the\u200c past 17 months, and according to \u2063economists, consumers shouldn&#8217;t expect rates\u200c to go back down anytime soon. With the Fed&#8217;s interest rate target now\u2062 at its highest level since\u200b the dot-com bubble, the impact on consumers is becoming more apparent. Credit card payments are\u200c becoming \u200cmore difficult to manage, and housing affordability is slipping out \u200cof reach for many\u2063 families.<\/p>\n<h3>Why the \u200dFed Won&#8217;t Be Slashing Rates Anytime \u200cSoon<\/h3>\n<p>Investors and economists predict that the Fed won&#8217;t be slashing rates and ending its tightening cycle in \u200dthe near \u200cfuture. To understand why relief might not come for months, we need to consider why the Fed has \u200dbeen raising rates in the first place. Inflation skyrocketed after the \u2064Fed kept rates near zero for two years during the pandemic, \u2062with <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/when-could-the-fed-start-cutting-interest-rates\/\" title=\"When might the Fed begin reducing interest rates?\">annual consumer price growth reaching<\/a> as high as 9.1%\u200c in June 2022.<\/p>\n<p>To combat rising prices, the Fed has had to push rates even \u200chigher. In some\u2064 cases, they raised rates at three times the scale of conventional increases in just one meeting. The\u2062 Fed&#8217;s goal is to achieve\u2063 2% inflation, \u200dbut while the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/feds-powell-cant-promise-hell-avoid-recession-in-fight-against-inflation\/\" title=\"Fed\u2019s Powell Can\u2019t Promise He\u2019ll Avoid Recession in Fight Against Inflation\">headline consumer price index<\/a> is \u200bcurrently at\u200b 3.2%, other measures of\u200d inflation remain elevated. As a\u200c result, the Fed \u200bhas indicated that\u2063 rates will stay high\u2062 or even increase further if \u200cinflation doesn&#8217;t show signs of dropping.<\/p>\n<h3>What Fed\u200b Chairman Jerome\u200b Powell \u2064Didn&#8217;t Say<\/h3>\n<p>Fed Chairman Jerome Powell recently addressed the future\u200d of the \u200ccentral \u2064bank&#8217;s monetary policy, leaving the door open \u200bto more rate\u200d increases despite expectations that rates have peaked. However, what caught the attention of many investors was what \u200dPowell \u2064didn&#8217;t mention\u2014a timeline for when rates might \u200cstart coming down. This\u2062 lack of clarity may frustrate those hoping for lower rates on the \u200dhorizon.<\/p>\n<p>Most economists,\u200b investors, and \u200dFed watchers don&#8217;t anticipate rates coming down until at least partway into 2024. Powell has set a\u2064 high bar for withdrawing monetary policy, emphasizing \u2064the need for a broad-based slowdown in\u200c price pressures, including \u200bwages, before considering rate cuts. This cautious approach aims to prevent a rebound in inflation \u200dand \u200cthe need for an extended period of high rates and\u2062 prices.<\/p>\n<h3>Investors&#8217; Expectations \u2063and Insights<\/h3>\n<p>Investors can gain insights into \u200cfuture rate movements through the CME Group&#8217;s\u2062 FedWatch tool, which calculates the probability of rate\u2062 changes based on futures contract prices. Currently, over 80% of investors believe the \u2064Fed will \u200dpause at its next meeting in September. However, opinions become more\u200b divided afterward, with nearly\u200b 60% expecting rates to be higher after the November \u200dmeeting and just over half predicting higher rates as we enter 2024.<\/p>\n<p>Looking \u200bahead to 2024, around 40% of investors anticipate lower rates \u2063by \u2063May, while 60% expect rates to remain as high or higher. However, by June, the \u2063majority predict\u200b the Fed will begin cutting rates, with\u2063 92% of investors betting on lower rates about a year from now. By the end\u2063 of 2024, approximately\u2062 55% of investors believe the Fed&#8217;s interest rate will be at least one <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/bernie-sanders-slams-the-so-called-inflation-reduction-act\/\" title=\"Bernie Sanders Slams \u2018The So-Called Inflation Reduction Act\u2019\">percentage point lower<\/a> than \u2062its current\u2063 level.<\/p>\n<h3>Expert Insights and the Fed&#8217;s Next Meeting<\/h3>\n<p>Andrew Patterson, a senior economist with Vanguard, suggests that there\u200b may be more\u200d rate hikes this \u2064year before the Fed starts reducing rates next year. He emphasizes the \u200dFed&#8217;s vigilance\u200b and data dependency in determining the need for sustained rates or further \u2064increases. The \u2064upcoming\u200b inflation reports\u2064 for August will play a significant role in \u2062the Fed&#8217;s decision at its next meeting on \u2062September \u206419\u200d and 20.<\/p>\n<p>As consumers and investors\u200c eagerly await the Fed&#8217;s next \u2063move,\u200c the\u200c future of interest rates remains uncertain. Whether rates hold steady or increase further will depend \u200con various economic factors, making it crucial to closely monitor inflation and the Fed&#8217;s \u200bpolicy decisions.<\/p>\n<p><em>Click <a href=\"https:\/\/www.washingtonexaminer.com\">here<\/a> to read more from The Washington Examiner.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Federal Reserve has increased interest rates for 17 months, and economists predict no immediate decrease. Currently at 5.25% to 5.50%, the rate is the highest since the dot-com bubble. Consumers should not expect a decline anytime soon.<\/p>\n","protected":false},"author":1,"featured_media":2013960,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[538],"tags":[],"class_list":["post-2013959","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-washington-examiner"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2013959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2013959"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2013959\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2013960"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2013959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2013959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2013959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}