For the veryfirst time consideringthat 2020, the Federal Reserve Wednesday cut interest rates as anticipated amidst falling inflation in the U.S. economy. Rates were cut by 50 basis points or a half percent. File Photo by Jemal Countess/UPI | License Photo
Sept. 18 (UPI) — For the veryfirst time giventhat 2020, the Federal Reserve on Wednesday cut interest rates as anticipated amidst falling inflation in the U.S. economy. Rates were cut by 50 basis points, or a half percent.
The Federal Reserve’s FOMC stated in a declaration, “In light of the development on inflation and the balance of threats, the Committee chose to lower the target variety for the federal funds rate by 1/2 portion point to 4-3/4 to 5%.”
Federal Reserve Chair Jerome Powell earlier had highly suggested the possibility of a rate cut.
The cut was made possible by inflation that hasactually fallen from a COVID-19 pandemic high of 9.1% to the existing inflation rate of 2.5%.
The Fed inflation target is 2%, however a rate cut was developed to assistance safeguard the economy from a economicdownturn after years of increasing rates.
The FOMC Wednesday declaration stated, “The Committee has acquired higher self-confidence that inflation is moving sustainably towards 2%, and judges that the threats to accomplishing its work and inflation objectives are approximately in balance. “
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