The Fed plans to cut rates, signaling confidence on inflation. July jobs report expected to show moderating hiring, balancing the Fed's mandate.

The Fed is poised to cut rates, signaling more assurance on inflation. The July jobs report is expected to show moderating hiring, balancing the Fed's dual mandate. Central bank decisions and global economic data will be closely watched as the Fed navigates this delicate policy path.

The Federal Reserve is poised to lower interest rates in the coming months, with Chairman Jerome Powell likely signaling this move at the upcoming meeting. Despite recent positive economic data, the Fed wants more assurance that inflation will continue declining to its 2% target. The key focus will be on the July jobs report, which is expected to show a moderation in hiring. The Fed's dual mandate of maximum employment and stable prices has become more balanced, as lower inflation has been paired with a rise in the unemployment rate. This delicate balance is likely to lead to broad agreement among Fed officials on the need for a rate cut, though the exact timing may vary. Central bank decisions and economic data from other countries will also be closely watched this week.

The US Federal Reserve is poised to lower borrowing costs in the coming months, with Chairman Jerome Powell likely signaling this move at the central bank's upcoming meeting on July 30-31. Despite recent promising data showing milder price increases and robust economic growth, the Fed wants more assurance that inflation will continue to fall towards its 2% target.

The key focus will be on the July employment report due on Friday, which is expected to show a continued softening in the pace of hiring amid limited layoffs. Non-farm payrolls are forecast to increase by 178,000, a healthy but more moderate pace, while the unemployment rate is seen holding at 4.1%. Other labor market data, such as job openings and quitting figures, will also be closely watched.

The Fed's dual mandate of maximum employment and stable prices has come more into balance, as the downdraft in price pressures has been paired with an upward creep in the unemployment rate. Officials want to tame inflation, but they also do not want to cause undue harm to the labor market by keeping rates high for too long.

This delicate balance is likely to lead to broad agreement among Fed officials on the need for a rate cut in the near future, though there may be minor differences on the exact timing. Most economists expect the Fed to lower rates in September, though the decision could come as soon as the July meeting.

Beyond the US, other central bank decisions and economic data will also be in focus this week. The Bank of Japan is expected to announce plans to cut monthly bond purchases, potentially signaling a step towards quantitative tightening. The Bank of England, meanwhile, may lower rates for the first time in over four years, though the decision is seen as a close call.

In the Eurozone, GDP and inflation data for the second quarter will provide insights into the state of the economy and whether the European Central Bank will be able to lower borrowing costs again in September. The Conference Board's consumer confidence index and the Institute for Supply Management's factory report will also offer important clues about the US economy.

Overall, the Fed's upcoming decision and the broader global economic landscape will be closely watched by investors and policymakers alike, as central banks navigate the delicate balance between taming inflation and supporting economic growth.