Federal Reserve Cuts Interest Rates for First Time Since 2008
The Federal Reserve lowers interest rates by a quarter point, marking the first rate cut in over a decade. Chairman Jerome Powell describes the move as a mid-cycle adjustment rather than the start of a lengthy easing campaign.
The Federal Reserve cuts its benchmark interest rate by a quarter percentage point, marking the first rate reduction since the financial crisis in 2008. This decision lowers the federal funds rate to a range between 2% and 2.25% as policymakers aim to guard against growing economic risks and slowing global growth.
Despite the historic nature of the cut, Fed Chairman Jerome Powell frames the move as a mid-cycle adjustment to the central bank's monetary policy. He emphasizes that this single rate cut does not represent the beginning of a long, aggressive series of reductions, leaving investors uncertain about the central bank's future plans.
The announcement comes amid ongoing trade tensions and persistent concerns about global manufacturing weaknesses. While two members of the Federal Open Market Committee vote against the cut, the majority view supports this proactive step to sustain the current economic expansion and keep inflation on target.