Overview
- Futures pricing implies roughly mid-to-high 90s percent odds of a 25-basis-point move on Wednesday, which would lower the federal funds target to 3.75%–4.00% for a second cut this year.
- With the jobs report on hold, officials are leaning on private readings that point to labor-market cooling, including ADP’s estimate of a 32,000 drop in September payrolls and weaker Beige Book anecdotes.
- The Consumer Price Index rose 3.0% year over year in September with a cooler core reading, keeping tariff-driven price concerns in check and reinforcing the case to prioritize employment risks.
- Debate over balance-sheet policy is intensifying, with Chair Jerome Powell signaling reserves are nearing 'ample' levels as markets watch for hints on when quantitative tightening could end.
- Mortgage costs have eased to a 6.19% average for 30-year loans, while globally the Bank of Canada is expected to trim its rate to 2.25% and the European Central Bank is seen holding near 2%.