The Federal Reserve has announced a significant interest rate cut, lowering its benchmark rate to the lowest level in three years in a move aimed at supporting economic growth and countering signs of a potential slowdown.
The central bank reduced rates by 0.5 percentage points, citing easing inflation pressures, cooling job growth, and global uncertainty. The decision marks a clear shift in monetary policy after months of cautious optimism about the economy’s resilience.
Fed Chair Jerome Powell said in a press briefing that the rate cut is intended to “ensure the economy remains on a sustainable path,” emphasizing that the central bank will continue to monitor data before deciding on further adjustments.
Markets reacted swiftly — Wall Street rallied on the news, while the U.S. dollar weakened slightly against major currencies. Economists say the cut could boost consumer spending and business investment, though some warn it may also encourage excessive risk-taking in financial markets.
With borrowing costs now at their lowest since 2022, the move underscores the Fed’s determination to shield the economy from uncertainty while maintaining long-term price stability.
