Federal Reserve cuts interest rates by half-point; first rate reduction in four years

Published On Sep 18, 2024, 10:02 AM

The Federal Reserve has cut interest rates by 50 basis points for the first time in four years, lowering the benchmark federal funds rate to between 4.75% and 5%. This decision comes after recent positive signs of progress in reducing inflation, with the annual inflation rate dropping to 2.5% in August 2024. The Fed's action is seen as a response to ongoing economic uncertainty and aims to foster a more favorable environment for borrowing and spending. Further rate cuts are expected in the coming months if inflation continues to trend downward.