Federal Reserve’s likely slowdown in rate cuts could disappoint borrowers

AP Economics Writer

WASHINGTON (AP) — Just a few weeks ago, the path ahead for the Federal Reserve looked straightforward: With inflation cooling and the job market slowing, the Fed appeared on track to steadily cut interest rates. In September, its officials predicted they would reduce their benchmark rate four times next year, on top of three rate cuts this year. Yet that outlook has swiftly changed. Several strong economic reports, combined with President-elect Donald Trump’s policy proposals, have led to a more cautious tone from the Fed that could mean fewer cuts and higher interest rates than had been expected. Fewer rate cuts would likely mean continued high mortgage rates and other borrowing costs for consumers and businesses. Auto loans would remain expensive.