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A funny thing happened on the way to the U.S. recession of 2024: the irrepressible American economy refused to play along. At the start of the year, investors around the world were looking for as many as six quarter-point interest rate cuts from the Federal Reserve to protect economic growth and fight inflation.

But inflation has stayed stubbornly above the central bank’s 2% target and the economy keeps growing despite an overnight interest rate target range of 5.25-5.5%, the most among the Group of Seven industrial countries. By early February those six rate cuts had become three, and on Wednesday, Fed Chair Jerome Powell gave the world the idea that there might not be any.

In the circumspect language of a central banker, he said, “We do not expect that it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2%. So far this year, the data have not given us that greater confidence…..Story continues…