Based on recent developments and statements by Federal Reserve Chair Jerome Powell, it is likely that the Fed will begin its rate-cutting cycle at the September 2024 meeting. Powell has expressed growing confidence that inflation is on a sustainable path back to the 2% target, which allows the Fed to shift its focus toward protecting the labor market. The rate cuts are expected to start with a quarter-percentage-point reduction, though there is a possibility of a more aggressive half-point cut if the upcoming economic data, particularly the labor market report, shows significant weakness.
Market expectations and analyst forecasts align with the anticipation of a rate cut in September, supported by Powell's recent statements at the Jackson Hole Economic Symposium. The Fed has "ample room" to reduce borrowing costs, and traders are fully confident in at least one rate cut before the end of the year?(Kiplinger.com，Kitco).
Therefore, the most probable outcome for the September 2024 Fed meeting is a 25 basis point rate cut, with some possibility of a larger cut if economic conditions warrant it.
