Additionally:
The Fed's 1st priority is keeping inflation in check.
But their 2nd priority is keeping employment as high as possible. 1st priority obviously takes precedence (it is #1 after all); but with rates at this level, as Hongbit pointed out:
Right now, everyone is focusing on the 2ND PRIORITY because if holding rates ta this level tips the economy into a recession... they just screwed up their 2nd priority and it's no longer a "soft landing" but a hard landing with unemployment jumping (already jumped from 3.7-ish % up to 4.3% in the latest report...).
Personally, I think the economy is too strong for us to be anywhere near a recession. Zero chance IMO.
But that's what ALL the Finance conversation is revolving around today... Recession? Rate cuts? How much? When? I even heard a proposal for an "emergency session" to drop the Fed Rate by 50 basis, like, right now.
I think that's a bit ridiculous, just wait till Sept. September meeting will be to drop by 25 or 50 basis points... I think a rate cut is pretty much baked in... could go either way on the 25 or 50... too early to tell at this point...