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Audio-Gilhooly says Fed could cut rates if housing stays weak
BNP Paribas Senior Bond Strategist Richard Gilhooly said the Federal Reserve could cut interest rates in the near term if the housing market remains soft. “We think, effectively, over the next three to six months the Fed will have a window to lower rates if they need to,” he told the Reuters Investment Outlook Summit in New York. The U.S. central bank has kept its benchmark overnight lending rate at 5.25 percent since June 2006. Financial markets currently show little chance of a rate cut between now and year-end. As recently as late April, rate futures priced in between one and two quarter-point Fed eases.