This article was automatically translated from HIBAPRESS, the Arabic version:
This article was automatically translated from HIBAPRESS, the Arabic version:
Heba Press
The US Federal Reserve decided on Wednesday to cut its key interest rate for the third time in a row this year, by 25 basis points, to a range between 4.25 and 4.5 percent.
Federal Reserve officials have set the number of times interest rates will be cut in 2025, a sign of caution about the pace of reducing borrowing costs.
The decision of the American Central Bank, in line with market expectations, demonstrates that inflation is under control, down from its peak. In 2022, inflation will be more than double its current rate.
The Federal Reserve has cut interest rates at two previous meetings, first cutting prices by half a percentage point in September in light of signs of a slowdown in the labor market, and then by a quarter of point last month.
On Wall Street, stock values fell after the Federal Reserve’s decision, while Treasury yields rose.
Federal Reserve Chairman Jerome Powell told a news conference after the central bank’s monetary committee meeting that the action taken was firm, “but we view it as the good decision.”
He explained that after reducing interest rates by one percentage point, the US central bank “can now be more cautious because it intends to make further adjustments to the key interest rate.”
The U.S. inflation rate has fallen significantly since mid-2023, but the slowdown in price growth has been uneven, particularly over the past two months.
Based on the Federal Reserve’s measure of inflation, underlying prices, which exclude volatile food and energy prices, rose 2.8 percent for the year ending in october.
Federal Reserve officials slightly raised their core inflation forecast for 2025, to 2.5% from 2.2% in September. They also lowered their unemployment rate forecast from 4.4 to 4.3 percent.
