The Federal Reserve did just as markets expected. It cut rates by 25 basis points on Wednesday, its second cut this year.
Its path forward looks a little less clear. At its September meeting, five Fed members said they wanted to keep the fed funds rate at 1.75% to 2% through the end of the year, while seven members want another cut before 2019 ends.
David Kelly of J.P. Morgan Asset Management says the Fed isn't as divided as it appears.
"I think the division when it comes to these forecasts is between the overall FOMC and the voting members. There's 17 members overall. There are 10 who get to vote and those who don't get to vote are all Fed bank presidents who are a little bit more hawkish. So what we think is the case is that actually the 10 voting members are in favor of cutting one or maybe two more times this year, but the overall committee is not."
Jim Caron of Morgan Stanley says markets are betting on another move by year's end.
"The dollar index tells the story. The markets are disappointed. The dollar strengthened, and the way I look at the Fed right now is that they're successful if they can get the dollar a little bit weaker, and if they can get the curve a little bit steeper. The markets have already priced ... one more cut in December."
Mona Mahajan of Allianz Global Investors says data dependency is key to the Fed's next move.
"We're growing at a decent pace ... Europe, China, not so much. So I still think Treasuries, dollar, gold you're going to see that trade continue for some time because of this. The markets are hoping for one to two more this year and then one to two more next year. In a midcycle adjustment, three is the average, it could be four, so I don't know ... I think you'll have to be data dependent at this point. If we get a resolution to trade by year end, will we really need to cut again? Probably not, but if we don't, I think one or two more are probably likely here."
Fred Mishkin, former Fed governor, says the Fed needs to better communicate.
"What the Fed needs to do is make clear how we react when data comes in in the future, and we've had some central banks do this and do it quite well. The Fed has been extremely disappointing on this. One of the reasons why that's so helpful is because the markets will then do your work for you. Even before you act, if in fact the data comes in a certain way the markets are going to react to lower interest rates."
Lori Calvasina of RBC Capital Markets says economists are as divided as Fed members.
"I think it depends on what happens with the data going forward. There's been a lot of talk initially that there's this deep division in the Fed. Well, guess what? There's a deep division among economists around the street as to what the Fed should be doing, and you've actually seen over the last month or so, equity investors' expectations for where the economy is headed. I wouldn't say they've really been robust, but they've been healing, they've been on the upswing, and so it's a little bit easier to deliver this message 'we're only going to cut if we need to' when people are starting to feel a little bit better about the economy.