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- Inflation is moving in the right direction and is likely to decline in the fourth quarter
- Four reductions are planned for 2025
- He wants to be “absolutely certain” that inflation will return to 2% before the initial cut, which should be considered the first in a series, which is why he is patient.
- Commodity stocks that rose 5% or more fell less than 20%
- Inflation remains the main concern, and companies say they see no cliff ahead for the labor market
- An inflation rate of 2% is achievable with a labor market that remains tight by historical standards
- There is still confidence that housing inflation will “return to desired level”.
- GDP and labor market data indicate an “orderly slowdown” in activity that would balance supply and demand and reduce inflation.
Picture Jerome Powell cutting interest rates in the fourth quarter and saying it’s the start of the series. The market certainly wouldn’t hate for the federal funds to be priced at 4.12% for October 2025. That’s a bit lower than Bostic expected. Note that Bostic is also aligned with the median in the dot plot.
This article was written by Adam Paton at www.forexlive.com.
