The Fed cut rates by 0.25% today, as widely expected. However, Fed officials are struggling to agree on future rate cuts. According to WSJ:
“Seven of 10 Fed officials voted in favor of lowering the benchmark federal-funds rate to a range between 1.75% and 2%, with two reserve bank presidents preferring to hold rates steady and one favoring a larger, half-point cut.”
Still, the door has been left open for possibly one more rate cut this year. Additionally:
“The Fed also on Wednesday injected money into the banking system for the second day in a row to ease a crunch in overnight funding markets, and said it would do so again on Thursday. The operations are aimed at keeping the fed-funds rate in the central bank’s target range.”
Stocks responded by rising, after an initial quickie sell-off. However, as we write this, futures are showing that stocks may gap down at open tomorrow still.
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