Fed Members Signal Possible Rate Cut in September Amid Steady Economic Growth

The Federal Reserve's latest minutes reveal potential for a rate cut in September, despite steady economic growth and a resilient job market. Members noted a modest easing in financial conditions and ongoing progress toward inflation goals. The next committee meeting is set for September 17-18, 2024.

The Federal Reserve's latest meeting minutes signal a potential policy rate cut in September. Most members indicated that if economic data aligns with expectations, easing monetary policy would be appropriate.

Held on July 30-31, 2024, the Federal Open Market Committee (FOMC) decided to maintain the federal funds rate between 5.25 and 5.5 per cent. Despite slower growth than 2023, the U.S. economy remains strong, with a resilient labor market evidenced by a 4.1 per cent unemployment rate.

Additionally, the minutes noted easing financial conditions, including declining long-term interest rates and rising equity prices. Discussions also emphasized that inflation, although elevated, is progressing toward the Committee's 2 per cent objective. Market observers are closely watching the FOMC's decisions, which will impact consumer spending, investment, and economic sentiment. The next meeting is scheduled for September 17-18, 2024.

(With inputs from agencies.)