The last two Fed meetings resulted in rate cuts. Short-term CD rates have continued to lower, but some long-term CD rates are rising back up again.

When accounting for the various policies, Deutsche Bank estimates the US economy will grow at an annualized rate of 2.5% in 2025, with the rate of unemployment ending the year at 3.9% (down from 4.1% currently) and the Fed's preferred inflation gauge, "core" Personal Consumption Expenditures (PCE), ending 2025 at 2.6%.

Minutes from the Federal Reserve policy committee's most recent meeting show that central bankers favor a cautious approach to cutting their benchmark interest rate.

Powell just a week after the meeting said the economy was "not sending any signals that we need to be in a hurry to lower rates."

"Unemployment is going to come down, growth is going to come up, inflation is going to come up," Deutsche Bank's chief US economist said.

The Federal Reserve cut interest rates by 50 basis points in September and followed up with another reduction of a quarter percentage point in November. Steve Sosnick, Interactive Brokers chief strategist,

Many” senior Federal Reserve officials said a more gradual approach to reducing interest rates was warranted in light of ongoing uncertainty about the U.S. economy and the appropriate level of borrowing costs,

Despite inflation in some sectors remaining outside the Federal Reserve's benchmark of 2%, officials indicated they are pleased with the current easing of interest rates, and more gradual cuts may follow.

The Federal Reserve cut interest rates at its last two meetings–and the odds are shifting in favor of it making it a hat-trick next month. Traders think there's a 67% chance the central bank slashes borrowing costs by 25 basis points and just a 33% chance it stands pat on Dec.