Federal Reserve officials were at odds during their October meeting over cutting interest rates, divided over whether a stalling labor market or stubborn inflation were bigger economic threats, minutes released Wednesday showed.

While the Federal Open Market Committee approved a cut at the meeting, the path forward looks less certain. Disagreements stretched into the outlook for December, with officials expressing skepticism about the need for an additional cut that markets had been widely anticipating, with “many” saying that no more cuts are needed at least in 2025.

“Several participants assessed that a further lowering of the target range for the federal funds rate could well be appropriate in December if the economy evolved about as they expected over the coming intermeeting period,” the minutes stated. “Many participants suggested that, under their economic outlooks, it would likely be appropriate to keep the target range unchanged for the rest of the year.”

(CNBC - Continue Reading)

Financial results to be released on Wednesday by chipmaking-giant Nvidia will be closely watched as a bellwether for the stock market and the overall economy, which have both come to rely on massive spending on artificial intelligence to propel continued growth.

The latest test for the world's most valuable company arrives at a fraught moment for markets, which have fallen for four consecutive days over fears of an AI bubble. Nvidia, which makes many of the chips fueling AI products, has suffered a decline of more than 10% over the past two weeks.

As big-tech names spend hundreds of billions on chips and data centers necessary for the energy-intensive technology, the financial benefits remain uncertain. The earnings reported by Nvidia will gauge demand for a key building block of AI, showing whether appetite for the technology remains at a fever pitch.

(ABC - Continue Reading)

Bond traders all but scrapped their bets on a December interest-rate cut after the government canceled the publication of the October employment report, leaving Federal Reserve officials without a key piece of economic data before their final meeting of the year.

The Bureau of Labor Statistics said Wednesday that some October jobs data would be rolled into a report to be published after the Fed’s December decision. The announcement prompted traders to scale back expectations for a quarter-point reduction, with odds now heavily pointing to policymakers keeping the benchmark rate on hold at the 3.75% to 4% range. “This lowers the chances of a December rate cut,” Morgan Stanley economists led by Michael Gapen wrote in a note. “An easing labor market is the key argument for a December rate cut.”

(BBG - Continue Reading)