The Fed's Courageous Cut

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Koushik Korampalli
September 22, 2024
Est read: 0 minutes
  • The Fed’s fabled September rate cut has occurred
    • On Wednesday the Fed cut their interest rates by half a percentage point
    • This was a more aggressive action than expected
    • They also signalled further rate cuts
  • The chair of the Fed, Jay Powell, expressed his confidence in the US Economy: “The US economy is in a good place and our decision today is designed to keep it there”
  • This is their first Rate cut in 4 years
  • US Stocks saw rises of up to 1.1% immediately after the announcement
    • On Thursday the S&P 500 closed at a record high
    • The dollar also saw strengthening against the yen, but compared to a basket of peers, remained flat
    • European and Japanese stocks also climbed
  • However concerns about the labour market are causing some to believe that this excessive rate cut may be due to concerns about weakening employment
  • Further rate cuts are to be expected, Powell stated the Fed is committed to not falling behind.