The Federal Open Market Committee (FOMC) lowered the federal funds rate for the first time since March of 2020.
The FOMC lowered rates by 50 basis points to the 4.75% to 5.00% range, from the previous 5.25% to 5.50% range, where it had been since July of 2023.
While the move to lower rates was widely expected, there had been uncertainty about how much rates would fall. In recent weeks, due to solid economic news and the inflation rate dropping to 2.5%, there had been an increasing number of experts and analysts who believed the Fed would cut rates by 50 basis points. That indeed was the case.
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