Investors now overwhelmingly expect the Fed to cut rates again at its 17-18 September policy meeting. The Fed cut rates in July for the first time in a decade to mitigate the effects of the US-China trade row and a global slowdown. The rate is very low by historic standards but nearly two points higher than the years after the 2008 crisis when it fell to 0.5%.
Analysts will now shift their focus to the release of minutes of the Fed’s July meeting which are due out on Wednesday. Traders are also keenly waiting on the Fed’s Jackson Hole seminar and G7 summit in Biarritz this weekend for clues on what additional steps policymakers will take to bolster growth.