‘Weaker job growth and lower inflation’: It’s all lining up perfectly for a Fed cut in December

Photo: U.S. Federal Reserve Chair Jerome Powell attends a press conference in Washington, D.C., the United States, Oct. 29, 2025. The U.S. Federal Reserve on Wednesday decided to lower the target range for the federal funds interest rate by 25 basis points to 3.75 to 4 percent, marking its second rate cut this year. (Credit: Photo by Hu Yousong/Xinhua via Getty Images)

U.S. markets are closed today for Thanksgiving, but S&P 500 futures were flat by midnight after the index closed up 0.69% yesterday, its fourth straight day of gains. Investors appear satisfied with the index’s current position, just 1% below its recent all-time high. Asian and European markets were flat or up; India’s Nifty 50 rose to an all-time high.

As we head into the December holiday season, investors have good reasons to be jolly: The macro data appears to be lining up perfectly to push the U.S. Federal Reserve to cut interest rates in its final meeting of the year. The rarely wrong CME FedWatch futures index currently favors the chance of a cut to 3.5% at 85%.