The Anticipated Rate Cut Buzz in 2024!

Yesterday's release of the consumer price index (CPI) report marked a pivotal moment in the Federal Reserve's battle against inflation. Market sentiments swiftly shifted as the eagerly awaited inflation report revealed a 3.2% year-over-year increase in consumer prices for October. This represented a notable decline from the 3.7% annual inflation rate recorded in September, causing expectations for another Fed rate hike to plummet. When policymakers next meet in December, they will have in hand a report on this month's inflation, as well as a more recent read on the job market, which also cooled last month more than economists had anticipated, with the unemployment rate ticking up to 3.9% and wages rising at the slowest pace in nearly 2.5 years.

Federal Reserve Chairman Jerome Powell may say it’s still too early for him to talk about interest-rate cuts. But almost everybody else is. The prevailing sentiment among economists is a growing focus on when the Fed might pivot and initiate rate cuts to safeguard the economy from sliding into a recession, given the ongoing slowdown in the United States. Traders, in particular, are now anticipating that the Federal Reserve will start cutting rates by May 2024.