Five Things You Need to Know to Start Your Day: Europe
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Good morning. Traders look ahead to the Fed’s interest-rate decision next week and wonder if a big cut is possible. Gold rises to another record. The AI boom may have enough power to continue. Here’s what people are talking about.
All eyes are already on the upcoming Federal Reserve meeting, with some chatter of a half-point rate cut emerging again. The latest decline in Treasury yields and the US dollar’s broad weakness suggests some investors are still betting on a bigger-than-usual first reduction of 50 basis points. Policy-sensitive two-year Treasury yields dropped about five basis points in Asian trading. Former New York Fed President William Dudley said he sees scope for a larger cut next week. With the labor market cooling, Fed Chair Jerome Powell has set the stage for reducing rates. Traders are pricing in at least a quarter-point worth of easing at the Sept. 17-18 meeting.