Scott Helfstein, head of investment strategy at Global X, said the Fed was likely to take note of continued consumer strength after better-than-expected retail sales in the US in August. "With CPI inflation at 2.5 per cent, 300 basis points of real interest may be too high, but the Fed does have the freedom of action to start with a 25 basis point cut or a full 50 basis points," he said. The key, he said, is for the Fed to start cutting interest rates, and the magnitude of the rate cut may have little to do with the economy. Retail sales have grown slightly below the long-term average in recent months, but are still growing at a moderate pace, he said.