[Market Expects Fed to Cut Rates by 25 Basis Points Tonight, Internal Division Reaches Largest in Recent Years]
The Federal Reserve is experiencing its largest internal division in years, with Powell facing the task of coordination. The market expects the Fed to cut rates by another 25 basis points tonight, and Powell may avoid signaling further rate cuts in January next year to appease the hawks. Bank of America believes Powell might suggest that another rate cut would require significantly weak employment data or emphasize that the benchmark interest rate is already near a neutral level. Currently, 5 officials support a rate cut, 3 are undecided, and 2 support holding rates steady.