The Federal Reserve has scope to cut its key interest rate another three times despite above-target inflation, the OECD has said, as it predicted a slowdown in the US economy and labour market.
The OECD expects the US policy rate will be trimmed to 3.25 per cent to 3.5 per cent by spring next year, as high trade tariffs sap the country’s economic momentum.
US growth will slow to 1.8 per cent this year from 2.8 per cent in 2024, before ebbing further to 1.5 per cent in 2026, the Paris-based organisation predicted in its interim economic outlook on Tuesday.
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