The Fed's Meeting: Rate Cuts, Soft Landing, and Mixed Signals

The Federal Reserve is expected to keep its key interest rate steady at a 22-year high for the third time in a row, while releasing economic projections that show inflation cooling faster than previously estimated and the possibility of an additional rate cut next year. Fed Chair Jerome Powell is expected to reiterate that more rate hikes remain on the table, but markets are already pricing in a 40% chance of a rate cut in March. The Fed's latest economic projections indicate that rate cuts will begin next year, but the timing and frequency of the cuts are uncertain. The Fed's ongoing policy meeting may include discussions on rate cuts, and Powell may try to guide markets towards less aggressive rate cuts next year. Inflation remains a concern for the Fed, as price increases slowed slightly in November but remain above the Fed's 2% target. The US economy has shown resilience so far, but the possibility of a soft landing without a recession is still uncertain.