Federal Reserve Faces Tough Decision On Interest Rate Cuts

According to PANews, earlier this week, the U.S. Consumer Price Index (CPI) report led the market to believe that the Federal Reserve would slightly cut interest rates by 25 basis points this month. However, the situation took a sharp turn on Thursday. Former New York Federal Reserve President Dudley suggested that the Fed has reasons to cut rates by 50 basis points next week. Reports from the Wall Street Journal and the Financial Times also indicated that the Fed is facing a tough decision between a 50 basis point cut and a 25 basis point cut. Consequently, market bets on a significant rate cut next week have risen to a 50-50 probability. Next week will see several key events: On Monday at 20:30 UTC+8, the U.S. September New York Federal Reserve Manufacturing Index will be released. On Tuesday at 20:30 UTC+8, the U.S. August Retail Sales Monthly Rate will be announced. On Wednesday at 14:00 UTC+8, the U.K. August CPI Monthly Rate and the U.K. August Retail Price Index Monthly Rate will be published. On Thursday at 2:00 UTC+8, the Federal Reserve will announce its interest rate decision and economic projections. Following that, at 2:30 UTC+8, Federal Reserve Chairman Powell will hold a monetary policy press conference. Later on Thursday at 20:30 UTC+8, the U.S. Initial Jobless Claims for the week ending September 14 and the U.S. September Philadelphia Federal Reserve Manufacturing Index will be released. On Friday at 11:00 UTC+8, the Bank of Japan will announce its interest rate decision, and at 14:30 UTC+8, Bank of Japan Governor Kazuo Ueda will hold a monetary policy press conference.