The Federal Reserve is set to announce Its first interest rate cut in more than Four years at this moment the fed's Bench Benchmark rate is at its highest Point in more than two decades and the Central Bank kept it there in an effort To Tamp down inflation Federal Reserve Chair Jerome pal announced that it was Time for a policy adjustment during last Month's meeting in Jackson Hall Wyoming The inflation rate has dropped very Close to the 2% Target and while there's Some debate as to how big the cup may be Experts predict it will likely around a Quarter or a half of a percentage Point According to the financial services Company CME Group there is a 57% chance That the Federal Reserve announces a Half point cut and a 43% chance to cut Is one quarter of a percentage Point are You following along CBS News business Analyst Jill slesinger is here with me In studio 57 just in case you're not Because you're going to simplify all of This yes how big of a difference are Those two expectations oh it's a quarter Of a percentage Point see we're done That's great we finished it it doesn't Really matter okay what matters is They're starting and this is going to be A process and it's not going to end here And I think that that's what's really The the most important thing to anyone Who's watching which is you're either a
Borrower or you're a saver and this Decision will and this process will Begin to impact you if you're a borrower Interest rates are going to be moving Lower they will not go back to where They were during the pandemic we're not Going back to 0% interest rates 3% Mortgages you're just not going to see And for Savers you you've been very luy For the last you know couple years You've had 5% CD rates those rates are Going to start to go down and we don't Know where it's going to end I just want To be clear about that but the idea is That we're moving lower and depending on Where you're sitting in the economy and How you use your money it's going to cut You in different ways as you just Alluded to so what then are you watching For from today's announcement what key Words you know look I I know that Everybody wants a Fed Dakota ring this Goes back to Allan Greenspan you're too Young he was a Fed CH aill a million Years ago and we used to be like what's He saying and banki was a much clearer Speaker Janet Yellen was a clear speaker Jerome poell is a straight shooter and What we're also going to get today are The predictions by Federal Reserve Officials of where they think the Economy is going so people are going to Look at that summary of economic Predictions and they're going to say
Okay what's the FED thing and I'm going To just tell you right now they've been Wrong very often just like us they're Just Mortals they're thinking what might Happen they're going to react to the Data so really what we are seeing is What do fed officials think the rate the Rate uh cuts are going to be for the end Of this year through the end of next Year where do they think this is all Going to land in the press conference After this is announced you're going to See the Federal Reserve chair get Peppered on where are we going to end What will be the terminal rate where are We going to finish this process remember We went from zero to 5 and a qu to 5 and A half% in a hurry right and we want to Know are we going back to zero probably Not that happens when you're in a deep Recession are we going to be more more Like 3% that's what many people think I Like how you acknowledge that humans are Behind all this humans are imperfect and Emotional we're looking at Wall Street They seem to be kind of preparing for This announcement but when will folks Watching right now feel today's decision You know in some part they have already Because you've seen that mortgage rates Which the FED does not directly control Mortgage rates are controlled by supply And demand and we've seen those rates Come down from that 8% Peak now to about
6 and 1/4% for a 30-year fix rate Mortgage so it's already happening uh I Was with an expert a housing strategist Uh the past couple of days and one thing That he said to me that was really Interesting is he said you know even if The the mortgage rates go down to 5% That might be just enough to induce People to start getting back into the Housing market it's not going to be Great it's not going you're not going to Get a 3% fixed rate mortgage but maybe 5% is kind of closer to where it becomes More affordable so I think we see that With credit card rates they'll go down Not as fast as they go up but they'll Start to come down and auto loans should Start to come down you know look in some Respects I know we're rooting for lower Interest rates but when we see lower Interest rates happen very quickly Remember it's usually because we are in A deep recession so we are not rooting For that 3% at the end of this of this Rate cut cycle would mean we have a soft Landing maybe some bumps along the way But we have a soft Landing the economy Does not crater we don't see a deep Recession that to me would be ideal we Don't want to root for 0% because that Would mean job losses wage cuts that Would all be the bad stuff associated With a recession right great clarity From Jill as always thank you so much
