Many Wall Street analysts still expect the Federal Reserve to be more cautious in its first move to cut interest rates. "I would like them to cut rates by 50 basis points, but my guess is they will cut rates by 25 basis points," said Mark Zandi, chief economist at Moody's Analytics. "They have accomplished full employment and inflation back to target, and the funds rate of around 5.5 per cent is too high. So I think they need to normalise rates quickly and have a lot of room to do so." Tom Simmons, US economist at Jefferies, said: "Austerity, while it seems to be working, is not working exactly as they thought, so easing should be seen as equally uncertain." "So if you're not sure, you shouldn't rush." Kaplan, former Dallas Fed president, said: "I guess they're divided." "From a risk management perspective, there are still members who just want to be more careful." Seema Shah, an analyst at Principal Asset Management, said that for the Fed, it comes down to deciding which is more risky - a 50 basis point rate cut would reignite inflationary pressures, and a mere 25 basis point cut could lead to a recession. Criticised for being too slow to respond to the inflation crisis, the Fed may be reactive to the risk of a recession rather than proactive. (Jin Ten)