What are the chances of a Bernake Rate cut

[lowtempo]

Or him talking of a rate cut. The economy looks like it needs one badly and this might be the only thing that can spur the economy. The prime lending deal is holding the real estate market down and a rate cut would spur home buying.

Inflation by definition is having more demand than supply this will promote price increases for most things, but a rate cut for businesses would spur increased capital expenditure and that should increase supply, bringing prices down...

I think Bernake will acknowledge the slowing of the economy and this will spur speculation on a rate cut.....

What do you think?

[TonyM]

Inflation has not really changed since he stopped hiking the rate, he needs to raise the rate but he knows his name will be mud if he does and I think the rest of the year will see a status quo. Since so many on the street are convinced we will get a cut before year end, the benefits of him doing so are likely built into the prices to an extent, which is obviously a recipe for a huge fall in the market if he raises rates any time soon, but any further increases in inflation could start forcing his hand. To his credit he is managing the economy well by simply using his bias as opposed to actual hikes or cuts.