Federal Reserve Chairman Jerome Powell indicated during a press conference Wednesday that the central bank isn't planning on starting a series of interest rate cuts, according to former Wells Fargo Chief Economist John Silvia.
“It certainly came across to me that it was not a start of a series of rate cuts and I think the market was kind of disappointed on that,” he told FOX Business’ Liz Claman on “The Claman Countdown.” “The fed funds futures market had sort of priced in a series of cuts and that’s not at all what Mr. Powell was talking about.”
For the first time since 2008, the Federal Reserve on Wednesday lowered its benchmark interest rate by 25 basis points, or a quarter of a percentage point, to a range of 2 percent to 2.25 percent. After the Fed announcement, the Dow Jones Industrial Average and S&P 500 had their biggest daily percentage drops since May.
The former Wells Fargo economist said that even though the Fed didn’t signal a series of rates cuts, it could still lower rates in the future.
“I think there is a case for the Fed once again, if they’re serious about the trade, if they’re serious about the inflation target, they will be in another position to lower the federal funds rate again.”