Federal Reserve expected to cut interest rates by another quarter point

Federal Reserve expected to cut interest rates by another quarter point

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The Federal Reserve’s policy-setting committee on Wednesday is expected to cut interest rates by a quarter-point and give investors an indication about future rate cuts. A rate cut by the Federal Open Market Committee would be the third this year, bringing the policy rate to a target range of 1.50% to 1.75%.  Fed Chairman Jerome Powell will speak at 2:30 pm ET, a half-hour after the committee’s statement is released, and Fed watchers expect that the central bank will indicate it is holding off on further rate cuts as it watches for progress in the US economy and an easing of global tensions over trade and Brexit. An important metric that indicates the Fed may pause are US Treasury yields, which were higher this week. Yields edged up Wednesday following the release of the US third-quarter GDP report, which saw growth at 1.9%, better than the 1.6% expected.  The Fed, however, must contend with widely divergent views on Wall Street over the direction of the economy. Some commentators expect no more rate cuts for the rest of the year; others think a recession is looming and the Fed will have no choice but to keep cutting rates, even down to zero. Meanwhile, the fed funds futures market is pricing in about a 30% chance of a cut in December and more reductions next year. In the run-up to the Fed's decision, the DJIA recently traded down 47 points, or 0.18%, to 27.023.83 Contact the author: [email protected] Follow him on Twitter @PatrickMGraham    

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