Yahoo Finance published this video item, entitled “Economist talks Fed rate cuts starting in March with 3 more in 2024” – below is their description.
The US labor market has seen an uptick in company layoff announcements, with Macy’s (M), Wayfair (W), and Google (GOOG, GOOGL) recently set to cut jobs. With the labor market cooling, could this signal early March interest rate cuts which the market remains hopeful for?
Bank of America Chief US Economist Michael Gapen joins Yahoo Finance Live to discuss the factors that could lead to the Federal Reserve cutting rates soon.
Gapen notes that the labor market is significantly more impactful now to a Fed decision than in previous months: “The quicker the labor market cools down, the more Fed cuts should be coming.”
A soft landing scenario is expected as Gapen insists that “the Fed has a stronger vested interest in achieving that soft landing than at any point during the recovery,” and doubts that the Fed is reliant on the unemployment rate needing to reach 5% or above.
In the case that the Fed does not cut rates in March, Gapen believes that a June cycle “would not make much of a difference.”
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