Fed’s Rate Cut Plans Stop Making Sense

Latest economic data don’t show a need for monetary stimulus from the Federal Reserve

Testifying before the Senate Banking Committee Thursday, Federal Reserve Chairman Jerome Powell again signaled that the central bank is ready to cut interest rates later this month. Photo: AP

The facts have changed, but the Federal Reserve sure doesn’t seem like it is changing its mind.

The central bank has signaled that it is all but certain to cut interest rates at its policy meeting later this month—so much so that the debate among investors has moved on to how big the cut will be and when the central bank will cut next. Yet as the Fed has been busy sharpening its shears, its reasons for cutting rates have become less and less compelling.