Antonio Giambanco
Italy
2m
📉 The Fed cuts rates: what it really means The Federal Reserve decided today to cut interest rates by 0.25%, bringing them into a new range of 4.00% to 4.25%. It was a widely expected move, but with some interesting signals to interpret: 🔹 Jobs under pressure The Fed acknowledges that risks to employment are rising: job growth is slowing, unemployment is ticking higher, and the labor market is cooling. That’s why the central bank has decided to give more weight to the “employment” side of its mandate over inflation. 🔹 Inflation still lingering Despite a recent uptick, inflation remains “somewhat elevated.” The Fed believes that the impact of tariffs and higher prices could be temporary, but doesn’t rule out the risk of a more persistent effect. 🔹 Looking ahead The well-known “dot plot” (Fed officials’ projections) shows unusually sharp divisions: 9 members see two more cuts this year. 6 want no further cuts. 1 even argues for five more cuts. This reveals deep uncertainty about 2025, showing the Fed itself doesn’t yet have a unified outlook. 📊 In short: The Fed cut rates to protect jobs, while acknowledging that inflation remains a threat. The approach remains cautious: no aggressive cuts ahead, but also no intention to stay put for too long. For markets, that means more volatility, more entry opportunities! ⚠️ Disclaimer: This post is for informational purposes only and should not be considered investment advice.
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