Fed Cut This Week May Be Last For A While

Key Highlights

• Several officials believe they’re already at a neutral level which neither spurs nor constrains growth.
• The opposing views on how restrictive the Fed really is are likely to fuel another split decision, with some analysts betting on as many as three dissents. Powell’s task of forming a consensus will only prove harder in the absence of fresh economic data — the ripple effects of a government shutdown that spanned all of October and much of November.
• Official November data for the labor market won’t be released until Dec.
• 16, followed by inflation data two days later.“It leaves the Fed in this position of having to walk a fine line,” said Diane Swonk, chief economist at KPMG. Powell won’t be able to guarantee what the committee’s next move will be when he faces reporters after the meeting, Swonk added.
• “He’s got to represent the spectrum of views, which go from one extreme to the other, and that is just a much harder message to convey.”The central bank’s rate decision will be released at 2 p. m.