Fed rate cut already expected, so will markets react?

The federal reserve board begins its two-day meeting today, and there is every expectation that the central bank will reduce its prime interest rate.

The fed has been hinting at a rate cut from this meeting so long that it's not even rally a hint at this point -- and UNO professor Mark Rosa says banks have already started cutting rates.

"Mortgage rates that have come down from last August -- not August '24; August '23 -- that started with an eight, now mortgage rates you can find them fairly easily that start with a six," he said. "It's baked into the cake already."

The fed is only expected to lower rates on fourth of one percent -- and Rosa said a deeper-than-expected cut would actually foreshadow bad news on the economy.

"So anything outside of that is going to send a signal that, 'wow, we might closer to recession than a lot of people think,'" he explained. "It is an encouraging thing. The price of money coming down. But let's not lose sight of the idea that the fed is lowering rate because they're seeing the economy start to slow."

It has been four years since the last time the Fed cut interest rates.