WSJ opinion piece argues the Fed should cut by a 50bp, not 25


Greg Ip is the chief economics commentator for The Wall Street Journal (gated).

He has weighed in on the FOMC decision coming up on Wednesday, September 18:

  • The Federal Reserve’s interest-rate decision this week looks more difficult than it should be. The real question isn’t how much to cut, but where rates ought to be. The answer is much lower. That argues for a half-point cut.

Goes on to say inflation is under control and that:

  • there isn’t much evidence a recession is in the offing. But waiting for that evidence is tempting fate.

I can’t say I agree. “Isn’t much evidence” argues waiting for at least some IMO. I am still tipping 25bp. Maybe the data this week will tip the scales:

This article was written by Eamonn Sheridan at www.forexlive.com.