The Federal Reserve Board of United States announced on the 18th local time that it would cut the target range for the federal funds rate by 50 basis points to a level between 4.75% and 5.00%. This is also the first time in four years that the Fed has cut interest rates.
In addition, according to the Fed's projections, the federal funds rate will reach 4.4% by the end of this year United States which is the target range of 4.25% to 4.5%, falling to 3.4% by 2025 and expected to fall to 2.9% by 2026.
The Federal Reserve is scheduled to hold a monetary policy meeting on the 17th and 18th. Fed Chairman Jerome · Powell said in late August that the time had come to cut rates, almost "specifying" that the Fed would announce a rate cut at its September monetary policy meeting.
According to data released by the United States Department of Labor on the 11th, the United States consumer price index (CPI) rose 2.5% year-on-year in August, a 0.4 percentage point narrower increase than July. This is the smallest increase since February 2021 and shows signs that inflation continues to slow. At the same time, the United States labor market continues to weaken. Also according to the Labor Department, the number of layoffs in the United States rose to 1.76 million in July, the highest level since March 2023.
From March 2022 to July 2023, the Fed raised interest rates 11 times in a row, with a cumulative increase of 525 basis points. Over the past year, the Fed has maintained its target range for the federal funds rate at between 5.25% and 5.5%, the highest level in 23 years.
Source: CCTV News
Edit: Ziyan
