Federal Reserve to Cut Interest Rates for First Time Since December Amid Slowing Job Market

Fed Expected to Cut Interest Rates Amid Stalling Job Market The Federal Reserve is poised to announce a rate cut on Wednesday, marking its first reduction since last December, according to market analysts and economists. The central bank is widely expected to lower the target for its key lending rate by 0.25 percentage points, putting it in a range of 4 to 4.25%, the lowest level since late 2022. "This move is a clear indication that the Fed has acknowledged the slowdown in the job market and is taking steps to stimulate economic growth," said Kathy Bostjancic, chief economist at Oxford Economics. "Lower interest rates will make borrowing cheaper for consumers and businesses, which should boost spending and investment." The rate cut is expected to kick off a series of additional reductions in the months ahead, according to analysts at Goldman Sachs. "We expect the Fed to continue cutting rates until we see a sustained improvement in the labor market," said David Kostin, chief economist at Goldman Sachs. The decision to cut interest rates comes as the US economy has shown signs of slowing down, with job growth and consumer spending moderating in recent months. The inflation rate, which had been a concern for the Fed in 2022, has come down significantly, making room for a rate cut. President Donald Trump has repeatedly called on the Fed to lower interest rates, but his demands have been met with skepticism by economists and analysts. "The president's views on monetary policy are not aligned with the data," said Mark Zandi, chief economist at Moody's Analytics. "The Fed is doing what it needs to do to support the economy." The rate cut is expected to have a positive impact on the stock market, with many analysts predicting a boost in equity prices. "Lower interest rates will make stocks more attractive to investors, which should lead to higher prices," said David Rosenberg, chief economist at Gluskin Sheff. The Fed's decision to cut interest rates marks a shift in its monetary policy stance, reflecting increased consensus that the economy needs a boost. The move is expected to have far-reaching implications for businesses and consumers, making borrowing cheaper and stimulating economic growth. Background: The Federal Reserve has been under pressure from President Trump to lower interest rates, but it has maintained its independence in setting monetary policy. The central bank has raised interest rates several times since 2015 to combat inflation and maintain economic growth. Current Status: The Fed is expected to announce the rate cut on Wednesday, with many analysts predicting additional reductions in the months ahead. The move is expected to have a positive impact on the stock market and stimulate economic growth. Next Developments: The Fed's decision to cut interest rates will be closely watched by investors and economists, who will be looking for signs of further rate cuts or changes in monetary policy. The central bank's next meeting is scheduled for March 19-20, when it will review its monetary policy stance and make any necessary adjustments. *Reporting by Bbc.*