The US Federal Reserve Cuts Interest Rates by 25 Basis Points in December Meeting
In a widely anticipated move, the Federal Reserve’s Federal Open Market Committee (FOMC)
decided to cut interest rates by 25 basis points during its December meeting.
This lowered the upper bound of the federal funds rate from 4.75% to 4.50%,
marking the third consecutive rate reduction following cuts in September and November.
This series of reductions is the first since March 2020.
The decision comes amid an economic environment signaling a slowdown in inflation.
However, inflation remains relatively high, highlighting ongoing challenges for the US economy.
While the majority of FOMC members agreed on the rate cut, there were differing opinions.
The President of the Cleveland Federal Reserve voted against the decision,
favoring maintaining rates at current levels.
However, the majority viewed the rate cut as essential to supporting stable economic growth and addressing inflation.
The committee noted that US economic activity has continued to grow steadily in recent months,
despite noticeable slowdowns in certain sectors.
The labor market has shown general improvement since the beginning of the year,
with employment conditions continuing to strengthen,
even as the unemployment rate saw a slight uptick but remains at historically low levels.
Inflation
Regarding inflation, the Federal Reserve highlighted progress toward its 2% target for the Consumer Price Index,
though some sectors continue to experience inflationary pressures.
The Fed’s monetary policy aims to strike a balance between supporting economic growth and maintaining price stability.
The Fed’s statement emphasized its commitment to closely monitoring economic data to determine its next steps.
The statement noted that monetary policy decisions will consider labor market conditions,
inflation trends, and developments in global financial markets.
Additionally, the Fed announced its continued commitment to reducing its holdings of Treasury securities
and mortgage-backed securities as part of its balance sheet normalization strategy.
It reaffirmed its readiness to adjust its approach if new risks emerge that could affect
its dual mandate of maximum employment and price stability.
Market Outlook
Markets are now focused on the Federal Reserve’s next moves,
with expectations of continued gradual rate cuts if data supports further inflation slowdown.
However, the Fed has signaled that the number of rate cuts may be fewer than previously anticipated.
The US Federal Reserve Cuts Interest Rates by 25 Basis Points in December Meeting
The U.S. Federal Reserve is expected to lower interest rates by 0.25% in its meeting today,
setting a new range between 4.25% and 4.5%. This will mark the third consecutive rate cut this year.
However, the future direction of monetary policy remains uncertain,
especially with ongoing inflationary pressures and the recent stabilization of the U.S. labor market,
which had previously added pressure on the Federal Reserve to accelerate its easing policies.
Despite inflation declining from its peak in mid-2022, it remains above the 2% target.
This situation drives the Federal Reserve to adopt a more cautious approach to future rate cuts,
with some analysts predicting a slowdown in the pace of cuts by 2025.
Additionally, potential economic policies under the newly elected President Donald Trump could impact inflation,
further complicating the Federal Reserve’s future decisions.
With inflation hovering around 2.7% and continued economic uncertainty,
debates persist over whether additional rate cuts are necessary at this time.
Market Reactions
In this context, the stock market has risen by 27% as the year-end approaches,
raising questions about a potential correction in the near future.
Investors are increasingly concerned about persistent inflation and its impact on market stability.
This concern drives them to adopt more balanced investment strategies,
including a focus on mid- and small-cap stocks,
as well as moderate allocations to gold and cryptocurrencies.
The Third Consecutive Rate Cut Increases Inflationary Pressures
Wall Street Indices Rise Amid Global Interest Rate Decisions: U.S. stock indices closed broadly higher
on Monday as traders prepared for interest rate decisions from major central banks worldwide later this week. The S&P 500 rose by 0.4%, while the Nasdaq 100 climbed 1.5% to reach another record high. Broadcom and Tesla were among the session’s biggest gainers.
The 10-year Treasury yield remained unchanged at 4.40%, while Bitcoinprices reached a new record high.
Sentiment in the U.S. was relatively positive,
with a widely anticipated quarter-point interest rate cut by the
Federal Reserve is viewed as providing additional support and extending stock outperformance.
This optimism contrasts with losses in Asia and Europe on Monday
following weaker-than-expected retail data from China.
In the U.S., Chris Larkin, managing director of trading and investing at E*TRADE from Morgan Stanley,
stated that short-term momentum “may depend on what Federal Reserve Chair Jerome Powell
says and whether retail sales or the Personal Consumption Expenditures Index surprise the market.” He added that most of December’s stock market gains historically occur in the second half of the month,
noting that the S&P 500 has delivered a positive net return 78% of the time since 1957.
Focus on the Fed Decision
Traders are currently analyzing new economic data. On Monday,
reports showed that U.S. services sector activity has expanded fastest since October 2021. Meanwhile, a measure of factory activity in New York State fell by the most since May.
However, the main focus remains on the Federal Reserve’s decision on Wednesday,
which will be followed by monetary policy announcements from Japan,
the Nordic countries, and the United Kingdom later this week. Tony DeSpirito, BlackRock’s Chief Investment Officer for fundamental equities,
said on Bloomberg Television: “Even if we get a significant rate cut,
it will be because the Fed sees underlying strength in the economy.
This suggests that the rise in U.S. stocks may continue to broaden.”
Meanwhile, Monday’s Bloomberg Dollar Index fluctuated between modest gains and losses.
After rising by more than 6% this year, Wall Street has begun to feel the strain of the dollar,
as Donald Trump’s policies and rate cuts are seen as factors
putting pressure on the currency toward the latter part of 2025.
Tensions in Canada and Europe
The Canadian dollar dipped slightly following reports that Prime Minister Justin Trudeau plans to appoint Dominic LeBlanc as Canada’s finance minister.
LeBlanc will replace Chrystia Freeland, who resigned due to disagreements over how to prepare for a Trump administration.
Elsewhere, German lawmakers approved a measure paving the way for elections within two months,
supporting Chancellor Olaf Scholz’s plan to end his struggling administration early. Meanwhile, private sector activity in the Eurozone contracted less than expected,
with a larger-than-anticipated contribution from the services sector.
French bonds underperformed their peers after Moody’s downgraded the country’s credit rating.
Additionally, the Bank of France lowered its domestic growth forecasts,
citing political instability as a drag on household and business confidence.
Further Decline in China
In China, retail sales growth unexpectedly slowed in November despite signs of improvement in the housing market.
The data added to traders’ disappointment last week when Beijing pledged
to boost consumption but failed to provide details regarding fiscal stimulus.
Charu Chanana, Chief Investment Strategist at Saxo Markets in Singapore,
stated that retail sales data “reflects the dire situation there,
where stimulus efforts have prioritized optics over meaningful economic improvements.”
He added: “Even for a tactical recovery,
more is needed after a series of false starts and the looming threat of tariffs.”
Meanwhile, oilprices fell after the latest Chinese economic data intensified
concerns about weakening demand in the world’s largest crude importer.
Wall Street Indices Rise Amid Global Interest Rate Decisions
The Reserve Bank of New Zealand Cuts Interest Rates
This morning, the Monetary Policy Committee of the Reserve Bank of New Zealand announced a cut in interest rates by 50 basis points, from 5.25% to 4.75%. This marks the second consecutive rate cut, following a 25-basis-point reduction in the previous meeting. The latest reduction aligns with market expectations, which anticipated this move from the Reserve Bank of New Zealand.
In its statement, the committee indicated that the New Zealand economy is facing challenges, including a slowdown in economic activity due to restrictive monetary policies. There has been a noticeable decline in business investment and consumer spending, and labor market conditions continue to deteriorate. The statement also emphasized that global economic growth remains below the expected trend, with major economies like the United States and China experiencing slowdowns, while geopolitical tensions are adding further challenges to global economic activity.
Despite these challenges, there have been some benefits for the New Zealand market. Certain exporters have gained from improved export prices, while lower import prices have helped reduce inflationary pressures.
The committee clarified that the interest rate cut aims to support the domestic economy and stabilize inflation, which is currently within the target range of 1% to 3%. The statement also noted that inflation is approaching the mid-point target of 2%.
The committee emphasized that the current decision to cut interest rates by 50 basis points is the most appropriate measure at this time to avoid instability in GDP, the labor market, interest rates, and the exchange rate. Furthermore, this decision aligns with short-term financial market trends, while any future changes in interest rates will depend on ongoing economic developments.
The Reserve Bank of New Zealand Cuts Interest Rates
Strong Economic Data Lowers Wall Street’s Rate Cut Expectations: Robust job numbers have caused a decline
in Wall Street’s confidence that the Federal Reserve’s next interest rate cut will be significant.
U.S. companies added more jobs than expected in September, prompting varied market reactions. Contents
Yields on 10-year Treasury bonds rose to 3.8%, up from 3.69% in the previous session.
Meanwhile, the S&P 500 index remained steady, while the Nasdaq 100 index gained 0.1%.
This performance followed a rise in the U.S. dollar driven by stronger-than-expected job figures.
Surprise Job Numbers
Data released on Wednesday showed that U.S. companies added more jobs than expected last month,
contradicting other indicators suggesting a slowdown in the labor market.
Investors are now awaiting Friday’s nonfarm payroll report to assess the health of the U.S. economy.
Expert Commentary
Chris Larkin of E*Trade noted that the ADP job report exceeded expectations,
indicating that while the labor market is slowing, it is not collapsing.
He added that Friday’s report will be crucial in shaping near-term market sentiment.
Rate Cut Options
Bank of America strategists, led by Meghan Swiber, believe that a half-point rate cut is still an option,
even with a strong labor market.
On the other hand, Marc Rowan, CEO of Apollo Global Management,
warned that the Federal Reserve’s aggressive monetary easing could overstimulate the economy,
especially with rising real estate prices.
Diverging Views
Richmond Federal Reserve President Thomas Barkin took a different view,
stating that it is too early to declare victory over inflation,
emphasizing the ongoing uncertainties regarding inflation and employment.
Geopolitical Tensions and Market Impact
Regarding tensions in the Middle East, investors are hopeful that the situation will de-escalate,
as it did in April, despite Israel’s vow to retaliate against missile attacks from Iran.
Meanwhile, early gains in oilwere erased due to an unexpected rise in U.S. inventories,
with West Texas Intermediate crude trading at around $71 per barrel.
Uncertainty Concerns
Anna Rosenberg of Amundi Asset Management highlighted the significant uncertainty
in the markets but added that expectations remain that the tensions will not escalate into a full-scale war.
Stock Market Outlook
For stock investors, keeping oilprices below $100 per barrel
and maintaining solid corporate earnings are critical drivers of stock market growth.
Mary Ann Bartels of Sanctuary Wealth expects the S&P 500 to reach 6,000 points
by year-end if interest rates decline and consumer spending remains strong.
Corporate News
In corporate news, Humana’s shares dropped after a decline in Medicare quality ratings,
while Nike’sstock also fell after the company withdrew its full-year sales guidance.
Tesla’sshares declined by 3.5% following disappointing quarterly vehicle sales.
Asian Markets
Chinese stocks listed in Hong Kong saw their largest rise in nearly two years
after Beijing eased home purchase regulations.
This was part of a massive stimulus effort announced last week by Chinese leaders,
which boosted local and international markets.
Strong Economic Data Lowers Wall Street’s Rate Cut Expectations
On Friday, market bets indicated that the Federal Reserve might take this step for the second time
after a government report showed that inflation in the United States is slowing, nearing the Fed’s target of 2%.
According to the U.S. Department of Commerce, the annual inflation rate,
based on the Personal Consumption Expenditures Price Index—the measure targeted by the Fed—reached 2.2% in August.
This slowdown aligns with comments made by Fed Chairman Jerome Powell during a press conference
following the previous week’s half-percentage-point rate cut.
The primary goal of these rate cuts is to support the labor market,
which policymakers at the Fed consider relatively weak yet still resilient.
Commenting on these developments
Omar Sharif from Inflation Insights wrote, “If the Fed wants to cut rates by another 50 basis points in November,
inflation data won’t stand in its way.”
He noted that the pace of inflation’s slowdown will further motivate the
central bank to move swiftly toward achieving a “neutral” interest rate level.
Currently, interest rate futures contracts reflect a 54% probability of a half-point rate cut in November,
compared to a 46% probability of a quarter-point cut.
In either scenario, traders are betting that the current interest rate,
which ranges between 4.75% and 5.00%, will be lowered by 75 basis points by the end of the year.
They also expect the rate range to settle at 3.00%-3.25% by mid-2025,
slightly above what most Fed policymakers consider a “neutral” interest rate that neither stimulates nor slows the economy.
Expectations Are Rising That the Fed Will Cut Interest Rates by Another 50 Basis Points in November
U.S. Stocks Rise with Expectations of Significant Rate Cuts: U.S. stocks experienced a slight increase as traders analyzed the remarks of Federal Reserve policymakers
and anticipated further monetary easing following a half-point rate cut last week.
The S&P 500 index rose by 0.3%, nearing its all-time high recorded last week,
following statements from Federal Reserve officials regarding the central bank’s monetary policy.
As a sign that market gains may widen,
equal-weighted stocks within the benchmark index increased by 0.5%,
closing at a record level and granting companies like Bath & Body Works the same impact as Nvidia.
The Dow Jones Industrial Average also hit a record high,
while the Nasdaq 100 rose by 0.3%. Intel’s shares jumped by 3.3% among individual companies
after reports of a multi-billion dollar investment offer from Apollo Global Management in the chipmaker. Boeing’s shares increased by about 2% after presenting improved deal terms for striking workers.
Economic Data
Data showed that business activity in the U.S. remains strong despite slowing growth,
boosting confidence in the potential for a soft economic landing.
According to data released Monday,
business activity grew slightly slower in early September,
while expectations fell and the price index rose to its highest level in six months.
Adam Crisafulli from Vital Knowledge stated,
“This report is somewhat inconclusive and should not significantly alter the Fed’s expectations.
Preliminary purchasing manager indicators suggest
that the U.S. economy is in fairly good shape,
especially compared to Europe.”
Bolder Bets on Rate Cuts
Traders are betting on a monetary policy easing nearly three-quarters of a point by the end of the year,
indicating that at least one more significant rate cut is on the way.
Chicago Fed President Austan Goolsbee mentioned
that as inflation approaches the central bank’s target,
the focus should shift to the labor market,
likely resulting in more rate cuts next year.
Minneapolis Fed President Neel Kashkari noted the weakness in the labor market,
supporting another half-point rate cut by year-end.
In contrast, Atlanta Fed President Raphael Bostic took a more moderate stance,
stating that starting the cut cycle with a large step would help bring rates closer to neutral levels.
Still, officials should not commit to aggressive movements.
Monetary Policy Decisions
Later this week, investors will receive data on the Fed’s preferred price index and U.S. personal spending,
scheduled for release on Friday.
The yield on two-year Treasury bonds, influenced by monetary policy decisions,
declined to 3.58%, while little change occurred in long-term bonds.
U.S. government bonds were under pressure
as the Treasury Department prepared to issue $183 billion in short-term
offerings and new issuances of up to $25 billion in corporate bonds expected this week.
Chris Larkin from E*Trade, a Morgan Stanley affiliate, stated,
“With the first rate cut by the Fed since 2020 now on record,
many investors might wonder: ‘What now?’ This will keep the focus on economic growth,
especially in the labor market.”
Manufacturing Data in Europe
In Europe, the euro declined while European stocks
recorded slight gains following weak purchasing manager index data from France and Germany,
which showed that the private sector economy
in the Eurozone contracted for the first time since March.
The euro fell by up to 0.7% against the dollar amid
bets on bolder rate cuts from the European Central Bank.
Maria Vitman, Chief Multi-Asset Strategist at State Street,
stated on Bloomberg TV, “The market is almost demanding a more aggressive rate cut,
especially after what we’ve seen from the Fed.”
She added that the European Central Bank is “certainly behind the curve.”
Asian Markets
Elsewhere, Asian markets rose amid speculation that China
is on the verge of announcing a new stimulus package
following a short-term rate cut and a rare economic briefing scheduled for Tuesday. Gold reached a new record level as the conflict in the Middle East escalated,
increasing bets on rising prices as it is considered a haven.
U.S. oil and gas stocks outperformed in the market.
U.S. Stocks Rise with Expectations of Significant Rate Cuts
Gold Prices Near Record High Amid Data Supporting Rate Cuts: Gold prices remained near a record high,
as upcoming U.S. data is expected to provide clues on
whether the Federal Reserve’s 50 basis point rate cut last week will be the first in a series of significant reductions.
Gold Prices Near Record High Ahead of Data That Could Bolster Major Rate Cuts
Gold prices hovered near a record high as markets anticipated upcoming U.S. data.
to provide clues on whether the 50 basis point rate cut by the Federal Reserve
last week will be the first in a series of significant reductions.
On Friday, bullion traded near $2,620 per ounce after hitting a record high of $2,625.77 per ounce.
A batch of economic data, including the U.S. personal consumption expenditure gauge and jobless claims,
is set to be released later this week.
Federal Reserve Board member Christopher Waller said on Friday that he will likely support
quarter-point cuts at the central bank’s upcoming policy meetings
in November and December if the economy evolves as expected.
However, he noted that another half-point cut could occur if the labor market weakens.
Asian Stocks Rise Amid Anticipation of Stimulus to Support Chinese Economy
Asian stocks rose amid expectations that China may introduce more stimulus
to revive the world’s second-largest economy after the U.S. started a monetary easing cycle,
while gold prices are approaching a record high.
The MSCI Asia Pacific Index advanced, with stocks rising in China, Hong Kong, and South Korea.
U.S. stock futures also climbed. On Tuesday,
China announced a rare economic briefing by three top financial regulators as it cut one of its short-term interest rates,
fueling speculation that a new stimulus plan could be announced.
Oil Prices Rise After Weekly Gains Amid Escalating Middle East Conflict
Oil prices rose after a second consecutive week of gains
as the market focused on the escalating conflict between Israel and Hezbollah.
Brent crude neared $75 per barrel after gaining 4%,
marking its most significant weekly rise since April,
while West Texas Intermediate (WTI) was traded above $71 per barrel.
Hezbollah launched around 115 rockets, shells, and drones toward northern Israel on Sunday,
prompting counterattacks against the Iran-backed group in Lebanon.
The escalation—and concerns it could draw in Iran (a member of OPEC)—brought back the risk premium in oil,
helping Brent surge more than 8% from its lowest level since 2021, which it reached earlier this month.
However, hopes that the Federal Reserve’s rate cut last week would boost consumption remained
subdued due to concerns over the deteriorating outlook for fuel demand,
which has made hedge funds the most bearish on diesel ever.
Gold Prices Near Record High Amid Data Supporting Rate Cuts
Fed Bets Push Wall Street Towards Small Stocks: As bets on a half-point rate cut by the U.S. Federal Reserve increase,
investors are shifting their investments towards economically sensitive sectors, moving away from traditionally safe areas.
Experts from Morgan Stanley, Goldman Sachs, and JPMorgan noted that the impact of the rate cut size is less significant on stocks than the overall state of the U.S. economy.
This trend has been reflected in the financial markets,
with U.S. 10-year Treasury yields dropping by three points,
the dollarreaching its lowest level since January, and goldprices soaring to record highs.
This reflects growing investor anxiety and seeking safer assets amid potential market volatility.
The increasing bets on a half-point rate cut by the Fed have driven investors toward economically sensitive sectors,
moving away from extensive tech stocks considered safe havens. Appleshares fell by 3% after warnings that the demand for the iPhone 16 Pro was below expectations.
Despite no significant changes in theS&P 500 on Monday, most listed stocks saw gains, reflecting a shift of funds into non-tech stocks.
S&P 500 Performance and Tech Stock Decline
This divergence is mainly due to the weak performance of major tech companies that dominate the main U.S. stock index.
Meanwhile, the equal-weighted measure within the S&P 500—
which gives companies like Target and Microsoftequal impact—has approached its all-time highs,
indicating a broader stock recovery this year.
John Stoltzfus from Oppenheimer Asset Management expects these shifts
to reflect minor market corrections after the significant volatility in the S&P 500.
U.S. Economy’s Impact on Stocks More Significant Than Rate Cut Size
With the Fed’s decision approaching, strategists from Morgan Stanley, Goldman Sachs,
and JPMorganemphasized that the state of the U.S. economy is more critical to stocks than the rate cut size.
Kali Cox from Ritholtz Wealth Management predicted that the impact
of a rate cut would be minimal compared to the path of future reductions over the next year.
Divergence in Indices and Stocks
The S&P 500 remained stable at around 5625 points,
while the Nasdaq 100 fell by 0.6% and the Dow Jones Industrial Average rose by 0.4%.
The Bloomberg Magnificent Seven index declined by 1%,
while the Russell 2000, which includes smaller companies, increased by 0.6%.
This performance highlights the divergence between large and small stocks,
with bank stocks significantly outperforming the broader market,
buoyed by positive analyses of smooth economic landing prospects.
Impact of Bond and Currency Markets
U.S. 10-year Treasury yields fell by three basis points to 3.62%,
reflecting declining confidence in the long-term economy.
The dollardropped to its lowest level since January, and goldprices reached record highs,
signaling a growing demand for safe-haven assets amid market volatility expectations.
Performance of Tech Companies and Their Market Influence
Giant tech companies like Nvidiaand Microsofthave been significant
drivers of stock gains over the past two years due to their strong earnings and investments in AI technologies.
However, since theS&P 500 peaked in July,
the Magnificent Seven stocks have declined by over 6%,
while other sectors have started to gain momentum.
Tech Stocks Regaining Their Position
Paul Nolte from Murphy & Sylvest Wealth Management explains that
the winning stocks since July have been those outside the major tech sector,
yet technology is gradually regaining its market leadership.”
This recovery reflects a temporary reduction in tech exposure,
prompting investors to explore other sectors offering more significant opportunities.
Hedge Funds’ Return and Market Trends
According to a recent Morgan Stanley Prime Brokerage report,
hedge funds have resumed buying large tech stocks,
while defensive sectors like real estate and healthcare have experienced net sales.
This shift indicates investors’ readiness for a rate-cutting cycle and their bets on market recovery.
Stock and Bond Strategies and Divergent Expectations
According to Lisa Shalett of Morgan Stanley Wealth Management,
the markets show differing views on the future,
with stocks pricing in a smooth landing while bonds signal a potential recession.
If bonds are on the correct path, stocks may decline due to falling profits;
if bonds are wrong, rising interest rates could create headwinds for valuations.
Investor Recommendations Amid Market Tension
Goldman Sachs strategists, led by David Kostin, recommend caution,
noting that stock valuations remain limited at current levels, with economic growth as the main driver. JPMorganadvised focusing on defensive sectors, expecting small companies to benefit from declining bond yields.
Conclusion
Amid market tensions driven by elections, the economy, and potential rate cuts,
markets remain cautious and on edge.
Savita Subramanian from Bank of America advised focusing on stocks with safe dividends,
emphasizing that sometimes the safest options are the best, even if they seem unexciting.
Fed to Cut Rates as Inflation Slows and Job Market Weakens: The U.S. Federal Reserve is expected to cut interest rates
for the first time since 2020 in its meeting next week,
a long-awaited move by investors, businesses, and consumers.
This decision marks the end of the Fed’s series of rate hikes
initiated in 2021 to control inflation, which began spiraling out of control.
Federal Reserve officials will meet on Tuesday and Wednesday,
and they are expected to reduce the federal funds rate
by at least a quarter percentage point from the current range of 5.25% to 5.5%.
This comes after the rate has remained unchanged since July 2023.
Federal Reserve officials have recently indicated that a rate cut is imminent,
though there is ongoing debate about the size of this cut.
While some analyses suggest a quarter-point reduction will suffice,
others argue that a more significant half-point cut might be possible.
According to the CME Group’s FedWatch tool, there was a 49% probability of a half-point cut.
Effects of the Rate Cut
This anticipated reduction would be the first since March 2020,
when the Fed slashed rates to near zero in response to the COVID-19 pandemic.
The decision will close a significant chapter in the monetary policy that influences Americans’ financial lives.
Since March 2022, a campaign to raise interest rates increased borrowing costs on mortgages, credit cards, and auto loans.
Meanwhile, inflation has dropped from its highest in over 40 years to near pre-pandemic levels.
By June 2022, according to the Personal Consumption Expenditures (PCE) Index,
The Fed’s preferred measure was inflation, which reached 7.1%.
However, inflation has dropped to 2.5%, and the Fed expects it to hit the 2% target by September.
Impacts on the Job Market
The goal of raising interest rates was to reduce inflation by decreasing borrowing and spending,
allowing supply and demand to balance.
However, this also put pressure on the economy, especially the job market.
As business loan costs rose, companies reduced hiring.
The unemployment rate has increased significantly this year, raising recession warnings,
although the overall rate remains low compared to historical standards.
The Fed has faced the challenge of balancing and reducing inflation
while maintaining low unemployment levels, a dual mandate set by Congress.
Conclusion of a Historical Phase
Historically, reducing inflation to normal levels without causing severe damage to the job market is rare.
In the past, sharp Fed rate hikes have triggered recessions and mass unemployment.
However, this time, inflation appears to be under control without a significant collapse in the job market,
which is considered a positive and unusual development in economic policy.
Ultimately, the rate cut is a significant step toward restoring
economic balance after prolonged challenges impacting various sectors of the U.S. economy.
Fed to Cut Rates as Inflation Slows and Job Market Weakens:
