Recent weeks have been punctuated by a number of positive developments for the U.S. economy, the first of which was the significant upward revision to historical data on household disposable income. However, this was partially offset by weaker recent momentum, NBC’s Jocelyn Paquet notes.
Fed to continue cutting its key rate at a gradual pace
“In reality, however, the future path of household income will depend first and foremost on the evolution of the labour market. Which brings us to the second piece of good news of recent weeks: September's solid employment figures.”
“As for the third piece of good news, the Federal Reserve has not only decided to begin its cycle of monetary easing with a jumbo 50 basis point cut, but has also underlined its willingness to cut benchmark rates further in the months ahead, if the latest edition of its dot plot is anything to go by.”
“Assuming that inflation remains under control and that the U.S. elections do not cause too much disruption, we expect the Fed to continue cutting its key rate at a gradual pace over the coming months. This will probably not prevent growth from slowing significantly by the middle of next year, although we do not expect the economy to contract. Following this scenario, we anticipate growth of 2.6% and 1.2% in 2024 and 2025, respectively. This is better than the figures of 2.5% and 0.9% we presented last month.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD bounces off lows, approaches 1.1550
EUR/USD continues to recover ground lost and now extends the rebound to the 1.1550 zone on Friday. Meanwhile, the US Dollar maintain its bullish bias intact in response to a significant flight to safety amid increasing geopolitical concerns, while positive consumer sentiment data also contribute to the daily uptick.
Gold keeps the trade above $3,400 on safe-haven demand
Gold prices maintain its upward trajectory on Friday, reaching its peak level since late April above the $3,400 mark per troy ounce. Furthermore, the precious metal draws increased safe-haven interest amid escalating tensions in the Middle East, triggered by Israel's military action against Iran.
GBP/USD trims losses, retargets 1.3600
After an earlier dip toward the 1.3520 area, GBP/USD has regained some composure, trading within sight of the key 1.3600 barrier as the week draws to a close. The pair remains under pressure on Friday, weighed down by renewed US Dollar strength amid rising risk aversion and a stronger-than-expected consumer confidence report.
Crypto Today: Bitcoin, Ethereum, XRP clamber for support amid escalating volatility on Israel-Iran tensions
The cryptocurrency market has been hit by a sudden wave of extreme volatility, triggering widespread declines as global markets react to tensions between Israel and Iran. Bitcoin is hovering at around $104,668 at the time of writing on Friday, following a reflex recovery from support tested at $102,513.
Week ahead – Markets brace for central bank barrage amid heightened uncertainty
Fed officials to stand pat as they await further clarity. A dovish BoJ could push rate hike expectations into 2026. Deflation fuels speculation about negative SNB rates. BoE may sound more dovish after disappointing UK data.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.