Week InReview: February 2, 2024

Happy Groundhog Day.

The head of the International Monetary Fund said the Federal Reserve and other major central banks face more risks by easing monetary policy too early rather than too late, but stressed that the Fed shouldn't hesitate to cut interest rates. “Central banks need to be guided by data, not by exuberant expectations of markets,” IMF's Kristalina Georgieva said. On Wall Street, economists at Goldman Sachs, Bank of America, and Barclays — among the last holdouts for the Fed to start lowering its benchmark rate as soon as March — have pushed back their forecasts for cuts and are now shifting their expectations to a second-quarter move.

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