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16 Dec 2024

International Economy

FOMC meeting, December 17-18, 2024: The Fed is expected to cut its policy rate by 0.25% and signal fewer than four rate cuts next year (Business Brief No.4108 Full Ed.)

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FOMC meeting, December 17-18, 2024: The Fed is expected to cut its policy rate by 0.25% and signal fewer than four rate cuts next year 
  • At the FOMC meeting slated for December 17-18, 2024, the US Federal Reserve (Fed) is expected to lower the policy rate by 0.25 percent to a range of 4.25-4.50 percent, as November inflation and employment figures were largely in line with market expectations.
  • However, the direction of US monetary policy in 2025 remains highly uncertain. KResearch views that the Fed may cut the policy rate fewer than four times, which is less than the projection of the September 2024 Dot Plot. This is because Fed Chair Jerome Powell has signaled that the Fed is likely to adopt a more cautious approach amid stronger-than-expected economic growth and sticky inflation in the US. Meanwhile, US government policies under President Donald Trump could exert upward pressure on domestic inflation.
  • At the upcoming FOMC meeting, economic and inflation projections will be released. KResearch expects that the Fed may signal fewer policy rate cuts in 2025 compared to the four times previously indicated at the September 2024 meeting. Additionally, the Fed might upwardly revise its forecasts for economic growth and inflation in 2025 compared to prior estimates.

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International Economy

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