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The US Federal Reserve, headed by Jerome Powell, is set to make a pivotal move this week, possibly cutting interest rates for the first time in over four years. With inflation appearing to be under control and signs of a weakening labour market, it is widely anticipated that officials will lower their key interest rate by at least 25 basis points at the conclusion of their two-day meeting on Wednesday.
This decision marks a significant turning point, offering relief to the world's largest economy after an extended period of high borrowing costs.
Here's how the Federal Reserve works:
The Federal Reserve is the US central bank.
It raises interest rates when inflation is high to cool down an overheating economy and cuts rates when the economy is weak to encourage growth and reduce unemployment.
The Federal Open Market Committee meets eight times a year to set policies that balance inflation and economic growth.
Here's a timeline of the Fed cuts over the past years:
(Source: NDTV Profit)
(Source: NDTV Profit)
(Source: NDTV Profit)
(Source: NDTV Profit)
(Source: NDTV Profit)
(Source: NDTV Profit)
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