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Wall Street Pauses as Fed Rate Decision Looms

U.S. stock futures edged lower on Wednesday morning as investors braced for the Federal Reserve’s final policy decision of 2025. Dow Jones Industrial Average futures slipped about 0.1%, S&P 500 futures fell 0.1%, and Nasdaq 100 futures dropped 0.2% . The cautious trading reflects Wall Street’s reluctance to make bold moves ahead of the Fed’s announcement later in the day. Markets are currently pricing in a nearly 90% chance of a third consecutive quarter-point rate cut , according to the CME FedWatch tool. However, the decision is not without debate. Some Fed officials argue that easing policy is necessary to support a cooling labor market, while others warn that further cuts could reignite inflationary pressures. The muted action follows several sessions of sideways trading, with investors waiting for clarity on the Fed’s long-term stance. Traders will closely analyze the post-meeting statement at 2 p.m. ET and Chair Jerome Powell’s press conference for signals about the centr...
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Canada's Economy Contracts Unpredictably: Central Bank's Cautionary Outlook


 Canada’s economy unexpectedly contracted in the second quarter of 2023 at an annualized rate of 0.2% . The growth was most likely flat in July. This result will probably allow the central bank to hold rates amid a possible recession . The second-quarter reading was far lower than the Bank of Canada’s (BoC’s) forecast for a 1.5% annualized GDP growth as well as the 1.2% gain expected by analysts . The quarterly slowdown was largely due to declines in housing investment and smaller inventory accumulation as well as slower international exports and household spending. In June, Canadian wildfires adversely impacted multiple industries, including mining and quarrying and rail transportation.

The figures “leave little doubt that the Bank of Canada will keep interest rates unchanged next week,” said Stephen Brown, deputy chief North American economist for Capital Economics. The central bank hiked its benchmark overnight rate to a 22-year-high of 5.0% in July, the tenth increase since March of last year. Since then, the bank has said its future moves would depend on its reading of the data, which have been mixed.

In conclusion, Canada’s economy has contracted unexpectedly in Q2 2023, and growth was most likely flat in July. This result will probably allow the central bank to hold rates amid a possible recession. The quarterly slowdown was largely due to declines in housing investment and smaller inventory accumulation as well as slower international exports and household spending. The Bank of Canada is expected to keep interest rates unchanged next week, given the recent economic data.

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