Is it difficult to reduce by 50 basis points? After the CPI report is released, the market expects that the Fed will lower interest rates by 25 basis points in September.
After the highly anticipated release of the US July CPI data, Wall Street traders have increased their bets that Fed officials will cut interest rates by 25 basis points in September; the expectation of a 50 basis point cut has cooled off slightly.
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"New American Union News Agency": The way for interest rate cuts in September has been paved, and the focus is on the scale of interest rate cuts.
Timiraos said that a rate cut is almost inevitable and the focus of the September meeting will shift to whether the rate cut decision is unanimous and whether it will be a 25 or 50 basis point cut. The reason why the size of the rate cut may become a topic of discussion is because the recent US labor market has shown signs of potential weakness. Therefore, even if the inflation data is not as moderate as the Fed expected, the reason for the rate cut in September has become more justifiable. He believes that moderate inflation data may make it more likely for there to be three rate cuts this year.
The latest inflation data trends are diverging among multiple countries, and the expectation of a preemptive interest rate cut by the Federal Reserve is increasing.
According to China Securities Journal, on August 14th, several Western countries including the USA, United Kingdom, and France released their latest inflation data. Among them, both UK and France's CPI growth rebounded in July compared to the previous month, while the USA's July non-seasonally adjusted CPI fell further to 2.9%.