Live coverage: Federal Reserve cuts interest rates by 0.25%, Powell warns there's 'no risk-free path'
View original at finance.yahoo.comLive coverage: Federal Reserve cuts interest rates by 0.25%, Powell warns there's 'no risk-free path' The Federal Reserve cut interest rates by 25 basis points at the conclusion of its two-day meeting on Wednesday, marking the central bank's third cut of the year…
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US interest rates should be much lower and are currently 3 percentage points too high
80% confidenceThe balance of risks has shifted toward the labor market after downside risks to employment rose in recent months
80% confidenceThere is no risk-free path for policy as the Fed navigates tension between employment and inflation goals
80% confidenceThree factors will help the economy in 2026: resilient consumer spending, AI spending on data centers, and supportive fiscal policy
80% confidenceThe Fed's 0.25% rate cut is too small and should have been doubled, at least doubled
80% confidenceHousing is going to be a problem because the Fed doesn't have tools to address structural housing shortage
80% confidenceThere is no need for another rate cut from the Federal Reserve
80% confidenceThere are inflationary forces from governments borrowing record amounts, immigration reform fractionalizing labor supply, and tariffs fractionalizing goods flow
80% confidenceThe Fed doesn't expect its next move to be a rate hike
80% confidenceThe Fed will cast a skeptical eye on shutdown-distorted economic data, particularly household survey data and CPI
80% confidenceTariffs are causing most of the inflation overshoot
80% confidenceThe Fed will not cut rates again until after a new Chair replaces Jerome Powell in May
80% confidencePowell sounded very upbeat on productivity and growth, including AI effects
80% confidenceA 25 basis point decline in the federal funds rate won't make much difference for housing affordability
80% confidenceThe effects of tariffs on inflation will be relatively short-lived, effectively a one-time shift in the price level
80% confidenceThe baseline outlook is for solid growth next year
80% confidenceA quarter-point change in the federal funds rate is not going to make much of a difference in the housing market
80% confidenceThe Fed is killing growth because they're so afraid of inflation
80% confidenceAssuming no major new tariff announcements, inflation from goods should peak in the first quarter of 2026
80% confidenceAI job displacement is probably part of the story but not a big part yet
80% confidenceThere's actually not much the Fed can do about affordability issues
80% confidenceThe Fed's take on productivity and growth is very risk-friendly, with productivity possibly running about 2%
80% confidenceIf the Fed lowers interest rates, that's probably going to increase home prices even more
80% confidenceThe Fed expects tariffs to represent a one-time increase in prices and is focused on ensuring it stays that way
80% confidence
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