Dissent in the ranks of the Federal Reserve’s board of governors suggests that although the central bank is widely expected to cut interest rates by another quarter of a percentage point this week, this action could be the final one for a while.
“The market is already pricing in that the Fed will move another 25 basis points, so I don’t think there’s any surprises to be had there,” said Jamie Cox, managing partner for Harris Financial Group.
As of Monday, the CME FedWatch Tool was predicting a 94 percent probability of a quarter-point rate cut at this week’s meeting, with only a 6 percent probability of no change.
Working in the Fed’s favor is the recent easing of China trade tensions, which Cox said has helped tamp down uncertainty on Wall Street. “You get this kind of back and forth and that’s unsettled markets. Once something happens, markets can price it in and live with it,” he said.