With just two trading sessions left in 2024, the Federal Reserve remains a major concern for Wall Street.
While optimism about the central bank’s interest-rate cuts powered stocks to big gains for much of this year, Chair Jerome Powell dampened the mood somewhat this month. He signaled to investors that the Fed will probably only lower borrowing costs twice next year, with inflation still running above its 2% target.
Markets appear to have taken Powell’s press conference to heart. According to the CME FedWatch tool, traders now believe there’s an 89% chance that policymakers leave rates unchanged when its next meeting ends in January–up from 58% a month ago.
