The U.S. Federal Reserve on Wednesday announced its third consecutive interest rate cut, a move widely expected by investors and financial markets.
The Federal Reserve has cut its benchmark interest rate by a quarter of a percentage point and said its future target range will be 4.25% to 4.50%. The Fed has now cut the federal funds rate, the rate banks pay to borrow their reserves overnight, by 100 basis points (1 percentage point) since it began cutting it in September.
President-elect Donald Trump's victory in November has already brought significant changes to the economic landscape, with business confidence, investor confidence and consumer confidence surging.
President Trump's promise to raise tariffs is widely seen as complicating the Fed's mission. Although some economists have said they expect the tariffs to cause further inflation, most analysts believe that the tariffs will at most cause a temporary increase in the prices of some imports, and that China's We don't think it's widespread and sustained inflation that would prompt a government response. FRB.
Similarly, the president-elect's pledges to remove illegal aliens and strengthen border security could raise labor costs, leading some to believe that increased incomes for U.S. workers could fuel inflation. I'm looking at it. However, this view contradicts the argument of many economists that immigrant labor does not depress the wages of workers already in the United States.
With the promise of tax cuts, deregulation and fossil fuel-friendly energy policies, many companies, investors and households are hoping for further growth in the coming years.
Cleveland Fed President Beth Hammack voted against the rate cut, preferring to keep it on hold. Eleven other members of the Federal Open Market Committee, including Fed President Michelle Bowman, also voted in favor of the rate cut. Mr. Bowman supported a quarter-point rate cut in November, but voted against the Fed's half-point rate cut in September.
