Oddbean

FOMC to act decisively, but with confidence ========== The FOMC is expected to make rate cuts at the November and January meetings; Westpac predicts a terminal rate of 3.375% by end-2025; July's US employment report showed slower growth and a rise in the unemployment rate; FOMC participants are pricing in a 50bp cut in September and a 60% chance of a follow-up cut in November; Westpac expects a more muted easing cycle than the market currently expects; US employment estimates point to a stalling out of job growth, not a contraction; Current momentum in US economic activity is healthy with domestic final demand growth around 2.5% annualized; Westpac predicts 25bp cuts at the November 2024 and January 2025 meetings in addition to those already expected in December 2024 and March 2025; The 10-year US Treasury yield is expected to hold near its current level over the remainder of the year before drifting back up to around 4.00% in mid-2025; Westpac expects the Australian dollar to have a slow uptrend through USD0.70 from late-2025. #Fomc #UsEmployment #RateCuts #EconomicOutlook https://www.westpaciq.com.au/economics/2024/08/us-fomc-6-august-2023