OHIO — Financial experts said Americans should enjoy the “skip” on interest rates by the Federal Reserve, while it determines what its next move will be for the future.
What You Need To Know
- Experts say the Fed left rates unchanged at a range between 5% and 5.25%
- The skip buys some time for the Fed to evaluate banking sector stress
- Experts say the Federal Reserve is likely to be cautious to lower rates again
Jason Jackman, CEO of Johnson Investment Counsel, indicated that the even though the “Fed left rates unchanged at a range between five and five-and-a-quarter percent, the Fed was very careful to characterize this as a skip and not a pause,” which demonstrates that the U.S. has made some sort of progress in reducing economic and inflationary pressure.
With a number of bank failures, the skip is giving the Federal Reserve time to evaluate stress in the banking industry. In the meantime, while the Fed has made progress in slowing the economy and inflationary pressures, Jackman said we’re seeing “markets up this year.”
With all of these things happening, he explained that Americans should enjoy it for now, because the market is probably going to shift. There is a belief that a recession is on the way.
He added that for now, the Federal Reserve is “likely to be cautious to lower rates again, but you could see, if there is economic weakness next year, you could see the Fed begin to cut interest rates to battle that economic weakness and build the foundation for recovery."