Survey: US rates higher for longer

However, the group surveyed also say the Federal Reserve may wait longer than previously thought before cutting the Fed funds rate. Around 45% now see no rate reduction until the second half of next year or later, up from 29% in the last poll.

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Jerome Powell

Today, Jerome Powell, the head of the Federal Reserve, along with other important folks from the Fed, will be speaking in New York. You see, at their last meeting, they decided to keep the interest rates steady between 5.25% and 5.5% so they could take a good look at how the economy was doing. Now, everyone is eagerly waiting to see which way the wind blows and how it will affect future interest rate adjustments. Some recent information has come to light that has raised some eyebrows. Apparently, the US job market is booming unexpectedly and people are spending more money than expected in stores. This has got everyone wondering if the Fed's previous actions to tighten up things have put a damper on inflation.

The next FOMC meeting

A bunch of smart economists were asked about what they expect to happen at the next FOMC meeting, and guess what? More than 80% of them think that there won't be any rate hikes. On top of that, most of them think that the Fed is done with raising interest rates altogether. However, the survey also showed that the Fed might be dragging their feet on cutting rates for a lot longer than they were originally planning. In the last survey, only 29% of economists thought there would be no rate reduction until the second half of next year or later. But now, that number has jumped up to 45%. This news has had an impact on the value of the good old American dollar. People have been speculating that interest rates might stay high for a while, so the value of the dollar has been rising.

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