Federal government’s key interest rate cuts may not be as low as expected

Markets are preparing for the upcoming interest rate cuts overseen by the US Federal Reserve, but new information suggests that the cuts will not be as drastic as markets expected.

This is according to a statement from the BlackRock Investment Institute, which is part of the world's largest asset manager. The institute says that the US Federal Reserve is less likely to make deep interest rate cuts if inflation increases.The situation is so stable that it is barely moving. They said the Fed also needs to take into account the strength of the economy and that progress is being made in several sectors.

The extent of the interest rate cuts is expected to be announced on September 18.thlong before the November election. The Fed must also consider the election year, as it will also shake the economy. Election-induced speculation will be exacerbated by the rate cuts, leading to a fragile, frenzied stock market.

What interest rate cut can we expect?

It is expected that interest rates will be cut by 120 basis points this year and by a total of 250 by the end of next year. If this happens, interest rates would rise from the current 5.25-5.5% to 2.8-2.9%.

If BlackRock is right, the cuts will not be quite as drastic as the Fed may not want to cause too much disruption. This is especially true in the month of September, when both the stock and cryptocurrency markets are not doing well.

Investors should keep in mind that while the rate cuts are helping to cool inflation, this is unlikely to last very long. BlackRock says that while many analysts are calling for similarly drastic rate cuts as in the past, these predictions may be unreasonable.