US Fed Cuts Interest Rates By Half a Point
US Fed Cuts Interest Rates By Half a Point
The Facts
The US Federal Reserve on Wednesday cut benchmark interest rates by half a percentage point to the 4.75% to 5% range in the face of softening inflation and a potential slowdown in the labor market.
This marks the first time the central bank has lowered rates by as much as half a point since 2008, excluding the emergency rate cuts made during the COVID pandemic.
The Spin
The Biden-Harris economy is well on its way to a full recovery. The Fed needed to normalize interest rates after their huge fall, and this rate cut will help the economy stick the landing and avoid a recession. This should sway more voters away from former Pres. Donald Trump to VP Kamala Harris.
Aside from the Fed breaking tradition by cutting rates so close to Election Day — possibly influencing its outcome — this giant cut actually shows how poorly the Biden-Harris economy is doing. The economy needed this jolt just to show any sign of life, but it's not enough to help the average American.
