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Fannie Mae Expects Another Rate Cut from the Fed
Fannie Mae said Thursday its Economic and Strategic Research Group expects another cut to the federal funds rate at the next meeting of the Federal Reserve’s Federal Open Market Committee. The group is also projecting full-year GDP growth of 1.8%, assuming the coronavirus outbreak is relatively short-lived.
“The rapid international spread of the coronavirus and Saudi Arabia’s decision to dramatically increase oil production – and the resulting impacts on financial market volatility and consumer behavior – led us to revise downward our second-quarter growth forecast to near-zero and our full-year 2020 forecast to 1.8% from last month’s 2.2%,” said Fannie Mae chief economist Doug Duncan.
He added, though, “those forecasts are subject to significant uncertainty.” Near term, “We expect the FOMC to cut the federal funds rate by an additional 50 basis points at its next meeting, adding to its 50-bp cut from earlier this month.”
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- ◦Economy
