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If the Fed cuts interest rates, things could get ugly

The Fed meets Tuesday and Wednesday this week with a decision on interest rates coming at 2 p.m. that second day.

As of when I’m writing this, the markets think there is a 22-percent chance of a half-percentage point rate cut (50 basis points in banking lingo) and a 78-percent chance of a quarter-percent point (25 basis points) rate reduction.

Trump is lobbying for a 50 basis point cut, and markets think there is no chance of rates being held where they are.

If the Fed wants to regain its independence, it shouldn’t cut rates.

There will be political fallout and Trump will probably attempt to fire Fed Chairman Jerome Powell, but a central bank that’s above politics is worth the turmoil.

Credit: Source link

The post If the Fed cuts interest rates, things could get ugly appeared first on Fox USA Live.



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