From the Desk of Rick Dennen: Market Update and 2025 Outlook

November 7, 2024 — Today, the Federal Reserve lowered the Federal Funds rate by 25 basis points, setting the target range at 4.50-4.75%. This decision comes as no surprise as many factors indicate an economic softening. The latest US Personal Consumption Expenditure (PCE) report showed inflation easing to 2.1%, the lowest level since 2021 and a positive step towards the Fed's 2% target. Experts believe the Fed may cut rates again in December in an effort to engineer a soft landing and avoid a market downturn.

The Federal Reserve also considers the US jobs report. The latest data showed fewer jobs were added in October than expected, largely due to the impacts of hurricanes Helene and Milton and Boeing labor strikes. Despite this, the unemployment rate remained relatively unchanged at 4.1%. This suggests that the underlying strength of the labor market persists.

Of course, the election outcomes are top of mind for most business owners. The House results have yet to be determined and neither party has reached the required 218 seats for marjority. Should the GOP take the House, the Republican party will rule in the White House and Congress. Typically, the stock market performs very well after an election regardless of which party takes office. While there's always speculation about which political party is best for the financial industry, it's important to remember that the party in office isn’t the main driver of economic health or market performance. Ryan Nauman, Market Strategist at Zephyr, sums this up well, “The performance of financial markets, particularly equities, doesn’t hinge on who is sitting in the Oval Office, but rather on the health of the economy and corporate earnings.” 

The economy is strong and there are plenty of opportunities for growth in 2025, even with the potential threats of natural disasters and political conflicts abroad. Rather than dwelling on uncertainties, business owners should continue making sound business decisions. By maintaining a long-term perspective and adapting to changing circumstances, business owners can position themselves for success in 2025 and beyond.

To learn more about potential tax and policy implications of this upcoming Presidential term, register for our upcoming webinar. Tax expert Steve Blake with CBIZ Somerset and Marc Chandler, Chief Market Strategist at Bannockburn Global Forex, will cover these topics further on November 15th at 12pm EST. You won’t want to miss it.

About Oak Street Funding
Indianapolis-based Oak Street Funding, a First Financial Bank company, provides customized financial solutions for businesses in various industry sectors and third-party loan servicing for financial institutions. Oak Street Funding incorporates industry knowledge, easy-to-use technology and exceptional employees to deliver top-quality service and capital products to niche businesses nationwide. With in-house sales, underwriting, and servicing teams, and direct access to the CEO and executive team, Oak Street Funding is well-positioned to meet lending needs of borrowers in all stages of the business life cycle.

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