The FOMC emphasised that it was responding to subdued inflation and the downside risks to the outlook for US economic activity. The FOMC also noted the easing in global growth, reflected most recently in a softening in business investment.
Given all of this, and the recent ratchetting up of the US–China dispute, [2] market pricing currently suggests that the Fed is expected to lower its policy rate by a further 100 basis points by around this time next year. Graph 3  While US economic growth has held up reasonably well, growth in the euro area has slowed more noticeably.