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Christopher Waller, governor of the US Federal Reserve, suggested on Monday that future interest rate cuts will be more measured compared to the significant decrease in September. He expressed concerns about the economy potentially maintaining a strong pace, citing recent data on employment, Inflation, GDP, and income.
At a conference at Stanford University, Waller stated, “the data is signaling that the economy may not be slowing as much as desired.” He emphasized the need for caution in the pace of rate cuts, indicating a shift from the aggressive approach taken in September when the Federal Open Market Committee lowered the baseline interest rate by 50 basis points.
While the September meeting implied the possibility of further rate cuts through 2025, Waller did not commit to a specific trajectory. He mentioned a gradual reduction in the policy rate over the next year, acknowledging mixed data points such as a stronger labor market in September, slightly higher CPI Inflation, and robust GDP.
The final revision for second-quarter GDP growth indicated a stronger economy than previously thought, with little indication of a significant slowdown in economic activity. Waller’s remarks suggested a more cautious approach to future rate cuts, taking into account the evolving economic landscape.
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Emily Jensen, graduated from the London School of Economics and Political Science (LSE) in the UK in 2015 with a degree in Economics. She specializes in financial markets and international trade. After graduating, she worked as an analyst at an investment bank in London, where she developed expertise in global economic trends. She later transitioned into consulting, focusing on fintech ventures and providing insights into global economic developments. Emily is passionate about the intersection of finance and technology and aims to drive innovation in the financial sector.
