Skip to main content

Fed Opts Not to Cut Rates, Indicates 3 Rate Cuts Coming; CU Economist Says It's Keeping 'Options Open'

WASHINGTON–As expected, the Federal Reserve’s Open Markets Committee adjourned its meeting without cutting rates, but it also indicated it will likely cut rates three times during the remainder of 2024. 

The Fed continues to be concerned about the pace of inflation, which has remained stronger than many analysts have expected after it appeared it was cooling, held the federal funds rate in a range between 5.25% and 5.5%, a 23-year high.

Federal Reserve

While inflation remains above the Fed’s 2% target rate, other indicators, such as cooler spending by consumers and a potential slowdown in hiring, indicate the Fed’s rate increases are having their desired effect. 

In a statement at the conclusion of its meeting, which was similar to that it issued in January, the Fed said, “Recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated…Committee judges that the risks to achieving its employment and inflation goals are moving into better balance. The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks.

‘Careful Assessment’

“In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks,” the statement continued. “The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%. In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities, as described in its previously announced plans.”

ACU's Perspective

America's Credit Unions Vice President of Research and Chief Economist Curt Long thinks the Fed is still on the fence regarding rate cuts.

“The FOMC narrowly retained its projection for three rate cuts in 2024. Given the array of mixed data at present, including solid overall growth, an upward drift to unemployment, warming inflation, and concerns that faulty seasonal adjustments could be tainting all the above, the FOMC is keeping its options open. A June rate cut is possible, but it will hinge on the next two inflation prints.” 

The Fed’s economic projections can be found here.

Comments

Popular posts from this blog

NCOFCU Newsletter

The Bucket Coach is a financial advice book designed by Fire Services Credit Union, Tronto, Canada. and written exclusively for Fire Fighters It's a practical guide for household financial management, including investments, credit and mortgages, and retirement. Developed with contributions from Fire Fighters," NCOFCU Newsletter : " Kevin Connolly Chief Executive Officer    Fire Services Credit Union Phone: 416-440-1294 ext 301  Toll Free: 1-866-833-3285 E-mail:  kevin@firecreditunion.ca 1997 Avenue Rd Toronto, ON M5M 4A3 

Vought: ‘We’re Closing Down The CFPB’ — White House Budget Chief Says Agency Will Shut Down Within Months

  10/16/2025 09:03 am         WASHINGTON—White House Budget Director Russell Vought said Wednesday he plans to shut down the CFPB, PYMNTS reported. Russell Vought Speaking on  The Charlie Kirk Show , Vought said only a handful of employees remain at the CFPB’s Washington headquarters “while we close down the agency,” adding that he expects the process to be completed “within the next two or three months.” Vought’s remarks come amid a series of legal challenges targeting the Administration’s attempts to scale back or dismantle the CFPB. The Administration is currently facing lawsuits from a CFPB labor union and consumer advocacy groups, which argue that Trump lacks the authority to dismiss most of the Bureau’s staff or eliminate the agency altogether. On Wednesday, Vought repeated long-standing Republican criticisms that the CFPB has exceeded its authority and imposed unfair burdens on smaller financial institutions, PYMNTS noted. “All they want to do is wea...

New from AutoLink

New from AutoLink

Understanding the Fed’s Balance Sheet

Chair Jerome H. Powell Monetary policy is more effective when the public understands what the Federal Reserve does and why. With that in mind, I hope to enhance understanding of one of the more arcane and technical aspects of monetary policy: the Federal Reserve's balance sheet. A colleague recently compared this topic to a trip to the dentist, but that comparison may be unfair—to dentists. 1 Today, I will discuss the essential role our balance sheet played during the pandemic, along with some lessons learned. I will then review our ample reserves implementation framework and the progress we have made toward normalizing the size of our balance sheet. I will conclude with some brief remarks on the economic outlook. Background on the Fed's Balance Sheet One of the primary purposes of a central bank is to provide the monetary foundation for the financial system and the broader economy. This foundation is made of central bank liabilities. On the Fed's balance sheet, the liabili...

AI Meets Retail: Walmart Lets Shoppers Buy Directly Through ChatGPT Using Sparky Instant Checkout

  10/15/2025 07:10 pm         BENTONVILLE, Ark.— Walmart is teaming up with OpenAI to introduce Sparky AI-driven shopping experiences that let customers and Sam’s Club members complete purchases directly through ChatGPT using its new Instant Checkout feature, PYMNTS reported. The collaboration broadens Walmart’s use of artificial intelligence across its retail ecosystem and underscores a wider industry move toward conversational, predictive commerce. Through the integration, shoppers can plan meals, restock household essentials, or discover new products simply by chatting with ChatGPT—while Walmart manages the entire transaction process seamlessly in the background, PYMNTS explained. “For many years now, eCommerce shopping experiences have consisted of a search bar and a long list of item responses,” Doug McMillon, president and CEO of Walmart Inc., stated in the PYMNTS report. “That is about to change. There is a native AI experience coming that is multi-media...