Fed Goes Big With Interest Rate Cuts.
“Federal Reserve cuts rates by 50 basis points
WASHINGTON – The Federal Reserve on Wednesday enacted its first interest rate cut since the early days of the Covid pandemic, slicing half a percentage point off benchmark rates in an effort to head off a slowdown in the labor market.
With both the jobs picture and inflation softening, the central bank’s Federal Open Market Committee chose to lower its key overnight borrowing rate by a half percentage point, or 50 basis points, affirming market expectations that had recently shifted from an outlook for a cut half that size.
Outside of the emergency rate reductions during Covid, the last time the FOMC cut by half a point was in 2008 during the global financial crisis.”
The Federal Reserve took a mighty leap by lowering the interest rates by a larger than expected amount. This reflects confidence that the interest rates hikes that have caused so much pain for so many are now ready to come down because inflation has been curtailed. The decision comes a mere month and half before one of the most contested elections in American history and could alter American’s outlook and how they vote on November 5th.
