The Federal Reserve announced that they are planning to maintain the current levels of interest rates (5.25%-5.5%), with plans to start reducing them coming later in the year. Fed officials anticipates at least three rate cuts for 2024 and based off December projections, are anticipating one less rate cut to occur in 2025. Despite previous expectations of multiple rate cuts in 2025, the Fed is currently anticipating fewer cuts. Inflation rose by 3.2% in February, driven by housing and gas prices. Fed Chair Jerome Powell emphasized the need to balance lowering rates in order to promote economic growth amid the risk of reigniting inflation. Powell also indicated that the current interest rate may be at its peak for the tightening cycle and has signaled readiness to adjust as needed based on the current economic conditions and inflation risks.
Source: https://www.foxbusiness.com/personal-finance/federal-reserve-interest-rate-reduced-march
2 comments:
I will be interested to watch and see when the rate cuts come this year. Im glad that they are realizing that we need to cut interest rates in order to grow the economy. its just a complicated subject because there is so much that goes into it and inflation itself that they have to be mindful of.
The article I read talked about Switzerland becoming the first advanced economy to lower their interest rates, so it is even more likely the United States may follow suit in the coming months.
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