The Federal Reserve is expected to announce a quarter-point interest rate cut, lowering its target range from 4.75%-5.0%, as reported by CNBC.
The Fed’s decision, anticipated at 2 p.m. ET on Thursday, follows efforts to moderate inflation, which has eased but remains a concern. The move would mark the Fed’s second consecutive rate reduction as it attempts to manage the complex balance between economic growth and inflation control.
Trump’s economic policies, including potential tariffs and other inflationary measures, have contributed to market expectations for higher inflation, causing Treasury yields to rise and complicating the Fed’s task of lowering borrowing costs.
The mixed economic indicators — solid growth alongside weakening job markets — add to the uncertainty around the Fed's future actions, with markets now questioning if additional cuts will be feasible in 2024.
While the Fed aims to support the economy with lower rates, rising long-term borrowing costs, especially for mortgages and car loans, pose a challenge, as these rates impact consumer and business financing. Economists are closely watching how these conflicting trends will influence the Fed’s policies in the coming months.
Source:
NBC New York
