The data also raised market expectations for a sharp drop in interest rates
Posted: Tue Feb 18, 2025 3:27 am
Omair Sharif, founder of research firm Inflation Insights, noted that while the slowdown in monthly inflation was encouraging, officials will be closely watching the inflation outlook next year. “I don’t think this report will change their view on next year,” he said.
According to CME's "Fed Watch", the probability of the Federal Reserve keeping interest rates unchanged in January next year has dropped to 89.3%, while the probability of a 25 basis point rate cut has risen to 10.7%. The probability of maintaining the current interest rate unchanged by March next year has dropped to 48.2%, the probability of a cumulative interest rate cut of 25 basis points has risen to 46.9%, and the probability of a cumulative interest rate cut of 50 basis points has risen to 4.9%.
Fed's Goolsbee said inflation is still on track to reach 2% and today's data brazil phone number list showed that the recent strength in inflation was just a "bump." My forecast is that the interest rate path through will be slightly lower. Interest rates are likely to fall significantly over the next 12 to 18 months.
Overall, the latest inflation data may support the Fed's decision to continue cutting interest rates on the one hand, but on the other hand it may also reinforce the Fed's cautious stance and remind the Fed to assess the economic and inflation situation more carefully in the future.
On Wednesday, the Federal Reserve cut its benchmark interest rate by 25 basis points to a target range of 4.25% to 4.5%, the lowest level in two years. However, at a subsequent press conference, Federal Reserve Chairman Powell said the Fed is approaching the point of slowing down its rate cuts.
According to CME's "Fed Watch", the probability of the Federal Reserve keeping interest rates unchanged in January next year has dropped to 89.3%, while the probability of a 25 basis point rate cut has risen to 10.7%. The probability of maintaining the current interest rate unchanged by March next year has dropped to 48.2%, the probability of a cumulative interest rate cut of 25 basis points has risen to 46.9%, and the probability of a cumulative interest rate cut of 50 basis points has risen to 4.9%.
Fed's Goolsbee said inflation is still on track to reach 2% and today's data brazil phone number list showed that the recent strength in inflation was just a "bump." My forecast is that the interest rate path through will be slightly lower. Interest rates are likely to fall significantly over the next 12 to 18 months.
Overall, the latest inflation data may support the Fed's decision to continue cutting interest rates on the one hand, but on the other hand it may also reinforce the Fed's cautious stance and remind the Fed to assess the economic and inflation situation more carefully in the future.
On Wednesday, the Federal Reserve cut its benchmark interest rate by 25 basis points to a target range of 4.25% to 4.5%, the lowest level in two years. However, at a subsequent press conference, Federal Reserve Chairman Powell said the Fed is approaching the point of slowing down its rate cuts.