U.S. Stock Futures Edge Higher on Fed Rate-Cut Bets Despite Economic Jitters
U.S. stock futures moved slightly higher on Monday as traders continued to bet that the Federal Reserve (Fed) will cut interest rates soon. Last week’s weak U.S. jobs report raised expectations that the Fed could lower rates by 25 to 50 basis points in its upcoming meeting.
Lower interest rates are usually seen as positive for the stock market, since they reduce borrowing costs and support business growth. On Monday, this optimism helped futures on the S&P 500, Nasdaq, and Dow Jones trade in positive territory.
Still, investors remain cautious. Signs of an economic slowdown are keeping nerves high. A weaker labor market and soft consumer demand have raised fresh concerns that the U.S. economy could be losing momentum. At the same time, inflation remains a risk, which makes the Fed’s policy decision even more critical.
In the bond market, U.S. Treasury yields slipped to their lowest in months as traders shifted toward safer assets. In commodities, gold prices stayed close to record highs, supported by both rate-cut expectations and economic uncertainty. Meanwhile, oil prices gained slightly after OPEC+ signaled a slower pace of production increases starting in October, boosting market sentiment.
In the forex market, the U.S. dollar weakened slightly against major currencies, as traders assumed the Fed will need to act soon to support growth.
Impact:
U.S. stock futures could gain further if the Fed confirms a rate cut. However, ongoing economic weakness might limit the rally and trigger market volatility.
