Dow Jones Today: Stock Futures Tick Lower Ahead of Expected Fed Rate Cut; Treasury Yields Slip
Fed Drama May Come From ‘Dot Plot,’ Powell Remarks
4 minutes ago
With a Federal Reserve interest-rate cut a near certainty, intrigue is likely to come from elsewhere at the central bank today.
Traders are pricing in a 96.1% chance that the Fed will cut its benchmark interest rate by 25 basis points and the remaining 3.9% are expecting a 50-basis-point cut, according to the CME Group’s FedWatch tool.
When the Federal Open Market Committee wraps up its two-day meeting, members may divided on the decision and the course of monetary policy to come. The lineup itself isn’t exactly stable, with the Senate voting just Monday to confirm President Donald Trump’s newest appointee, White House economist Stephen Miran, while that night an appeals court ruled against President Trump in his efforts to oust Fed Governor Lisa Cook for allegedly falsifying mortgage documents.
Miran and two other Trump appointees to the Fed, Governors Christopher Waller and Michelle Bowman, may vote for a more aggressive rate cut, which could result in an unusually divided FOMC. Fed watchers also will be paying attention to the so-called “dot plot,” which shows officials’ forecasts for where they think their benchmark rate should be in the coming years. Markets are pricing in a “substantial loosening,” Samuel Tombs, chief U.S. economist at Pantheon Macroeconomics, wrote in a note to clients.
Investors also will be monitoring comments from Fed chair Jerome Powell at 2:30 p.m. ET, 30 minutes after the release of the central bank’s decision on rates. Powell could face a “challenging press conference” as he tries to summarize the FOMC’s debate, Deutsche Bank Chief U.S. Economist Matthew Luzzetti wrote in a research note.
US Stock Futures Tick Lower Ahead of Fed Decision
52 minutes ago
Futures contracts connected to the Dow Jones Industrial Average were fractionally lower early Wednesday.
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S&P 500 futures were down about 0.1%.
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Nasdaq 100 contracts also were down roughly 0.1%.
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