Washington, Nov 4 (AFP/APP):The US Federal Reserve is widely expected to cut interest rates again this week, while votes are being counted in one of the closest-fought presidential races in decades. Opinion polls show Democratic Vice President Kamala Harris and Republican former president Donald Trump in a dead heat ahead of Election Day on Tuesday. The Fed’s two-day rate meeting begins on Wednesday, and is expected to result in a quarter percentage-point rate cut the following day. The United States has remained a bright spot in the global economy this year, with inflation falling toward the Fed’s two percent target, while growth has remained robust and the labor market has remained surprisingly resilient despite recent signs of cooling. Against this backdrop, futures traders are convinced that the US central bank will announce another rate cut, assigning a probability of more than around 99 percent on Friday that it will move by a quarter percentage-point, according to data from CME Group. Many analysts agree with the market expectations of a 25 basis point cut, which would lower the Fed’s key lending rate to a target range of between 4.50 and 4.75 percent — three quarters of a percentage-point below its level in early September. “I think the Fed is probably going to cut interest rates by 25 basis points,” Jill Cetina, an executive professor of finance at Texas A&M University and a former vice president of supervision at the Dallas Fed, told AFP. “We continue to expect the FOMC to lower the fed funds rate by 25bp at its November and December meetings,” economists at Goldman Sachs wrote in a note to clients published Friday, referring to the rate-setting Federal Open Market Committee (FOMC).
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