Written by Chuck Jones
The Federal Reserve has three objectives for monetary policy; maximum employment, stable prices, and moderate long-term interest rates. The first two get most of the attention probably since the third one helps to influence the first two and they are the ones that impact consumers and businesses the most.
On Thursday the odds had been in favor of a 50 basis point decrease to the Federal Reserve’s Target Rate vs. 25 basis points, 60% to 40%, after New York Fed President John Williams gave a speech. However the Fed reached out to the Wall Street Journal to say his talk was academic in nature and not about the upcoming Fed meeting on July 31. Per the CME Group as of Friday the market is more inclined for a 25 basis point reduction by 75.5% to 24.5%.
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