Ex-NY Fed chief Dudley says he'd go for 50bp cut on 8 September

13th Sep 2024 09:39

(Sharecast News) - A former top US central bank official said the size of the Federal Reserve's first interest rate cut in the current cycle was still up in the air.

In remarks made at a forum organised by The Breton Woods Committee, William Dudley said he saw a "strong" case for a 50 basis point reduction when the Federal Open Market Committee next met on 17-18 September.

"I know what I'd be pushing for," Dudley said, according to Bloomberg.

Dudley was the current chair of the Bretton Woods Committee and led the New York Fed until 2018.

As recently as the previous week, Dudley had been anticipating a 25bp cut.

The former central banker also highlighted how "very unusual" it was for there to be this level of uncertainty on the outcome of a Fed meeting this near to the next policy announcement.

As of 1034 BST, Fed funds futures were assigning 41% odds to a 50bp cut by the Fed at its 17-18 meeting, while a 25bp cut was completely priced in.

Dudley added that the Fed usually did not like to surprise markets.