September 17th 2025.
As expected, the U.S. Federal Reserve made an announcement on Wednesday that they would be cutting interest rates by a quarter-point, bringing the benchmark rate to a range of 4% to 4.25%. This decision, which marks the first rate cut since December 2024, will bring borrowing costs to their lowest level since November 2022.
The reasoning behind this move is due to the current state of the labor market, which has been showing signs of weakness. In order to provide support to the slowing economy, policymakers have made the decision to lower interest rates. This decision follows Fed Chair Jerome Powell's speech at the Jackson Hole conference on August 22, where he hinted at the possibility of rate cuts in the near future, but did not commit to a specific timeline.
In related news, silver prices have seen a significant jump, rising by ₹291 to reach a lifetime high of ₹1,29,720 per kilogram. This surge in prices has been fueled by anticipation of the U.S. Federal Reserve's rate cut. This move has been widely anticipated by analysts, who view it as part of the Fed's cautious approach to balancing concerns about inflation with the need to maintain economic growth.
Overall, the markets had already taken into account the potential rate reduction, seeing it as a strategic move by the Federal Reserve to carefully manage the economy and its potential risks. With the rate cut now in effect, it remains to be seen how it will impact the economy and if it will help to stimulate growth in the coming months.
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