Editorial Board
Fed’s First Cut Shouldn’t Tie It Down
Financial markets are awaiting not one cut, but a pivot to more. That’s unhelpful.
One step at a time.
Photographer: Nathan Howard/Getty Images
Federal Reserve Chair Jerome Powell recently testified that he’d like to see more good news on inflation before cutting interest rates. He got what he asked for.
Year-over-year headline inflation fell more than expected to 3% in June from 3.3% in May, and core inflation slowed to 3.3% from 3.4%. Investors promptly raised their bets that the Fed would cut its policy rate in September — and began to wonder if it might happen as soon as the end of this month.