{"content":"The US Federal Reserve recently cut its benchmark interest rate by 25 basis points to a range of 4.00% to 4.25%, marking its first rate cut since December 2024. This decision was widely expected by economists and markets, given the current economic conditions. *Reasons Behind the Rate Cut:* - *Moderating Economic Growth*: The Fed noted that economic activity moderated in the first half of the year, with job gains slowing down and the unemployment rate edging up. - *Inflation Concerns*: Despite the rate cut, inflation remains above the Fed's 2% target, with the current rate at 2.9% year-over-year. - *Labor Market Weakness*: The job market has shown signs of cooling, with nonfarm payroll growth slowing down to 22,000 in August and the unemployment rate rising to 4.3% . *Future Rate Cut Expectations:* - *Two More Rate Cuts in 2025*: The Fed has penciled in two more rate cuts for this year, with the expectation that rates may finish the year near 4.0-4.25%. - *Data-Dependent Approach*: The Fed will continue to assess incoming data, the evolving outlook, and the balance of risks to decide on further rate cuts . *Impact on Markets and Economy:* - *Boost to Stock Markets*: Rate cuts tend to boost stock markets, with the S&P 500 and Nasdaq hitting record highs recently. - *Weaker Dollar*: A rate cut could lead to a weaker dollar, making exports more competitive but potentially increasing import costs. - *Cheaper Borrowing*: Lower interest rates could lead to cheaper borrowing costs for consumers and businesses, potentially stimulating economic growth #FedRateCutExpectations","images":[],"tags":[],"tradingPairs":[],"quotearticleid":0}