The Fed Cuts Interest Rates As Economic Uncertainty Looms


With record low unemployment levels, it’s clear that this is not an issue of a lack of jobs. Rather, it’s an issue of consumer confidence; people are hesitant to spend money due to fears about what might happen next in terms of tariffs or global markets. The rate cut should help alleviate some of these fears by making borrowing easier and cheaper for businesses and consumers alike.

The decision comes at a time when economists are predicting a potential recession in 2020 if there isn’t an improvement in the current situation soon. A recession would be devastating for individuals who have already been negatively impacted by inflation this year and could lead to further job losses across multiple industries.

President Trump applauded today’s announcement, tweeting his approval shortly after it was made public. He stated that “the Federal Reserve is doing exactly what they should be doing…it will make all loans much less expensive!” However, analysts point out that while lower interest rates may make borrowing easier for certain businesses, it won’t necessarily lead to increased consumer spending or boost economic growth overall unless investors begin investing again with more confidence than they currently have.

In addition, many experts believe that further rate cuts may be necessary if things don’t improve soon because simply lowering rates once was not enough during past recessions such as during the 2008-2009 Global Financial Crisis when several rounds were needed before any real improvements occurred. It remains uncertain how far the Fed will go with their rate cuts but one thing seems clear; they are committed to keeping the American economy afloat even as global uncertainties continue to rise around us all.

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