The Fed is set to cut interest rates for the third time in a row, by 25 basis points.
➡️➡️- Rate estimates in the Fed's "dot plot" from September forecast 100 basis points of cuts in 2025.
➡️➡️- Wall Street is predicting fewer cuts next year, for a total of 75 basis points. And some are predicting just 50 basis points, a level consistent with swap market pricing.
➡️➡️- Fewer cuts in 2025 are also consistent with the U.S. economy proving more resilient than officials expected just a few months ago. Recent data show inflation is falling more slowly than officials had expected and the labor market is not weakening as much as feared.
➡️➡️- The most important piece to watch is Fed Chairman Powell's remarks and press briefings.