FOMC: The language in the Fed statement is fairly vague and offers room for flexibility over coming months - ING

James Knightley, Chief International Economist at ING, notes that today's rate cut by the Federal Reserve should be characterized as an early pre-emptive move to help ensure the longest US economic expansion on record continues.

Key quotes

"The language in the Fed statement is fairly vague and offers room for flexibility over coming months. It keeps in play what futures markets are pricing - at least another three rate cuts before the end of 2020"

"But, if anything, the statement (and vote outcome) offers more support to our more cautious outlook of only one further rate cut, most likely coming in September"

"We see no reason for this situation to change in the near term. After all, domestic demand is strong, asset prices are high, the labour market is robust and even the manufacturing sector has shown renewed signs of life thanks to the US-China trade truce."