Fed cuts rates by 50 bps :

Fed cuts rates by 50 bps to 4.75% to 5% range and indicated two more 25 bps cuts this year and 100 bps cuts next year. Fed sees 2.9% as terminal rates by 2026.

GDP, which is now forecast at 2% for 2024, down from a prior forecast of 2.1%, and maintain this pace through 2027.  For 2024, Fed members sees the unemployment rate at 4.4% for 2024, up from a prior forecast of 4%.

The unemployment rate is expected to remain at 4.4% in 2025, up from a prior estimate of 4.2%, and fall to  4.3% in 2026, up from 4.1% previously.  

At the press conference that followed the decision, Fed chairman Jerome Powell downplayed concerns about a recession, pointing to solid growth, cooling inflation and a “very solid labor” market. 

EURO/USD is at 1.1128 and USDINR has gained to 83.67. Indian Indices are up 0.58% with Nifty at 25520. Gold is steady at 2567.