US Federal Reserve cuts interest rate by 25 basis points for 2nd consecutive drop
The seal of the Board of Governors of the Federal Reserve System is seen ahead of a press conference by U.S. Federal Reserve Chairman Jerome Powell after a Federal Open Market Committee meeting at the Federal Reserve in Washington, U.S., September 18, 2024. (AFP Photo)
The U.S. Federal Reserve on Thursday lowered its key interest rate by 25 basis points, marking the second consecutive reduction as inflation continues to ease.
Policymakers voted unanimously to cut the central bank’s key lending rate to a range of 4.50% to 4.75%, the Fed said in a statement.
The decision comes despite political uncertainty in Washington and signals the Fed’s commitment to further easing monetary policy as labor market conditions have “generally eased.”
The US Federal Reserve shrugged off political uncertainty in Washington and moved ahead with a quarter-point rate cut Thursday, easing monetary policy further as inflation continues to cool.
“Labor market conditions have generally eased” since earlier in the year, the Fed said, noting ongoing progress to bring inflation down toward the bank’s long-term target of 2%
The rate cut builds on the Fed’s action in September, when it kicked off its easing cycle with a large reduction of half a percentage-point, and penciled in additional cuts for this year.
The Fed’s favored inflation gauge eased to 2.1% in September, while economic growth has remained robust.
The labor market has also stayed strong overall, despite a sharp hiring slowdown last month attributed in large part to adverse weather conditions and a labor strike.
Fed Chair Jerome Powell faces questions from reporters Thursday and is expected to be quizzed about the economic impact of Republican Donald Trump’s victory in the US presidential race.
