Wednesday/ the first Fed funds rate cut in 10 years

Federal Reserve Chairman Jay Powell fielded a lot of questions today after the announcement that the Federal funds rate will be cut by 25 basis points to a target rate of 2.00 – 2.25%. He characterized the cut as a mid-cycle ‘adjustment of policy’ — and that it is a way to brace against downside risks. (Um, another way to ‘brace against downside risks’ would be for the Trump Administration to stop the never-ending tariff wars with China and others).

That means savers will earn even less money on their savings. Borrowers for say home loans, may get a little relief from lower borrowing rates .. but 0.25% will barely make a difference on an 18% annual rate on a credit card!

Steve Liesman from CNBC talking about the rate cut. The US dollar is the strongest it has been in two years. The immediate reaction from the US stock market was negative, probably because the comments from Federal Reserve Board chairman Jay Powell were less dovish than expected.

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