Wed Sep 18 17:28:25 UTC 2024: ## US Fed Expected to Cut Interest Rates for the First Time in Four Years
**New York, September 18, 2024:** The US Federal Reserve is set to announce its sixth interest rate decision for 2024 today, widely expected to bring down borrowing costs for the first time in four years. The move comes as inflation in the US has cooled to near the Fed’s target level, shifting the central bank’s focus to supporting the weakening job market and achieving a “soft landing” for the economy.
A 25-basis point or even a larger 50-basis point rate cut is anticipated, with experts suggesting that this might be the first in a series of reductions extending into 2025. This move signals the Fed’s commitment to sustaining economic growth, alongside its efforts to tame inflation.
The decision follows a period of stability, with the Fed holding interest rates steady for 12 consecutive months, having previously raised them by 5.25 percentage points since March 2022 to combat the worst inflation in 40 years.
The anticipated rate cut has already been met with positive reactions from the markets. Gold prices have risen, spurred by expectations of a weaker US dollar and increased liquidity. The IT, BFSI, Auto, and Realty sectors in India are also poised to benefit from a Fed rate cut.
However, concerns about China’s economic slowdown remain, with Bridgewater Associates founder Ray Dalio cautioning that the Fed’s decision might not have a lasting impact on global investors.
The market is closely watching how the Fed’s decision will impact the global economy, with investors expecting a ripple effect across central banks worldwide, including the Reserve Bank of India. The impact on various sectors and asset classes will depend on the extent of the rate cut and its underlying motivations.
The Fed’s announcement is scheduled for 2 pm EST (12.30 am IST on September 19). You can watch the announcement live on the Fed’s website or YouTube channel.
First Piper 