US Fed finally cuts rates – by quarter of a percentage point - video Dailymotion

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The US Federal Reserve cut interest rates by a quarter of a percentage point on Sept 17 and indicated it will steadily lower borrowing costs for the rest of this year, as policymakers responded to concerns about weakness in the job market in a move that won support from most of President Donald Trump's central bank appointees.  WATCH MORE: https://thestartv.com/c/news SUBSCRIBE: https://cutt.ly/TheStar LIKE: https://fb.com/TheStarOnline

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00:00In support of our goals and in light of the shift in the balance of risks, today

00:06At today's meeting, the committee decided to lower the target range for the federal funds rate

00:24By a quarter percentage point to four to four and a quarter percent and to continue reducing the size of our balance sheet

00:32We did welcome a new committee member today, as we always do, and the committee remains united in pursuing our dual mandate goals

00:40We're strongly committed to maintaining our independence and beyond that I really don't have anything to share

00:45It is such an unusual situation

00:47Ordinarily, when the labor market is weak, inflation is low

00:52And when the labor market is really strong, that's when you've got to be careful about inflation

00:56So we have a situation where we have two-sided risk

00:59And that means there's no risk-free path

01:02And so it's quite a difficult situation for policymakers

01:06And it's not at all surprising to me that you have a range of views

01:12It's not so much about having different views for the path of the economy

01:16But it's partly that

01:17But it's also partly about what's the right thing to do in light of this

01:21Of the tension between the two goals

01:23The stock market's doing more or less what I would have expected

01:33We didn't get the 50 basis point cut, which would have been a shocker

01:37We got exactly what we expected

01:38We were at these similar levels before the Fed announcement

01:44We got a little bit of a spike right after the announcement

01:48We got a sell-off, which is what I would have expected

01:51Buy on rumor, sell on news

01:53Everyone in the entire world knew this 25 basis point cut was coming

01:58It was about a 97% probability

02:01But the bottom line is that just moving forward

02:06What are we seeing?

02:07Mortgage rates are coming down

02:09We just had a record amount of refis that we haven't seen in a while

02:13That means people are going to reduce their monthly mortgage costs

02:17More money in the consumer pocket

02:19And that translates to corporations

02:21It's across the whole economy

02:23I do think that you have to stay bullish

02:27Basically, the market believes there's above 90% chance

02:30That the Fed is going to cut rate for 25 basis points

02:34So this is very well expected

02:35And the focus of the market is basically on the path forward

02:39Rather than the 25 basis points

02:41Growth is slowing down

02:43But at the same time, the situation is not too bad, I would say

02:47We still see the unemployment is still relatively low

02:51Demand of jobs slowed down

02:53But also, as Fed Chair Powell mentioned

02:57Basically, the supply side is also driving this

03:00Because of this immigration slowdown in the US

03:03Well, it's surprising that it's taken this long

03:08For the Fed to continue its rate-cutting program

03:12But it's an encouraging sign

03:14Because the second year of rate cuts

03:17Tend to be encouraging for stock prices

03:20It is a risk management cut

03:22But at the same time

03:23Because the Fed is likely to be cutting rates again

03:26In October and December

03:28It's an effort to put a floor

03:32Underneath a cooling job market

03:35And thereby reduce the risk of recession

03:52And inevitably, the likelihood that it falls would do

03:53In October and December

03:58Now, if you take the airbus 전�

04:02That will require a little counter

04:02More wow

04:03This is a rarement plan

04:04And the respiratory issue

04:05So this is the reason

04:06That shruged

04:06That was on the end

04:07It's a stop

04:07Let thisோ

04:09Thewn

04:09Better

04:09Bit

US Fed finally cuts rates – by quarter of a percentage point

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