Jerome Powell Announces Federal Reserve's Reduce in Interest Rates Amid Inflation Concerns

Wednesday, 18 September 2024, 18:02

Jerome Powell's Federal Reserve has cut interest rates by 0.50 percentage points, addressing growing inflation. This significant move aims to alleviate borrowing costs for consumers facing high interest rates. With this adjustment, the federal funds rate now ranges from 4.75% to 5%, marking the first reduction since 2020.
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Jerome Powell Announces Federal Reserve's Reduce in Interest Rates Amid Inflation Concerns

Interest Rate Cuts and Economic Implications

On Wednesday, Jerome Powell and the Federal Reserve announced a 0.50 percentage points cut in interest rates, representing the first decrease in four years. This bold action is aimed at easing the economic pressure caused by skyrocketing inflation as consumers grapple with elevated borrowing costs.

Inflation and Labor Market Challenges

The adjusted federal funds rate now stands between 4.75% and 5%, down from 5.25% to 5.5%. Historically, rate cuts usually average around 0.25 percentage points. However, concerning trends in the labor market and a cooling economy have urged policymakers to opt for a more aggressive approach.

  • Previous rate hikes aimed to combat inflation
  • Inflation cooled to 2.5% on an annual basis as of August
  • Impacts on mortgages, credit cards, and consumer spending

The Path Forward

As consumers continue to feel the economic whiplash, the Federal Reserve’s actions under Jerome Powell signal a pivotal moment in U.S. monetary policy. The Fed’s ultimate goal remains to navigate through inflation while sustaining economic growth.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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