The Federal Reserve cut interest rates a quarter point on Wednesday and published a forecast suggesting two rate cuts next year.
This is the Fed’s third and final rate cut this year. They forecast half a percentage point worth of rate cuts next year, according to The New York Times.
A statement published by the Fed at 2 p.m. on Wednesday explained the decision (via FederalReserve.gov):
In support of its goals, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4-1/4 to 4-1/2 percent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.
Alfredo Ortiz, CEO of Job Creators Network, reacted to the news in a statement to Townhall.
“American small businesses have mixed feelings about Wednesday's rate cut. On one hand, the cut reduces their borrowing costs and increases their access to capital. Yet the cut won't help resurgent inflation and high costs that small businesses still say are the biggest problems they face, according to JCN's most recent national poll,” Ortiz said.
“Under the Biden administration, inflation has increased by 21% after being low throughout the Trump administration. Unfortunately, the weak Biden economy and labor market left the Fed with little choice. Moving forward, however, the Fed should hold rates steady until it's clear Bidenflation has been defeated, with price growth reaching or falling below the 2% target rate,” he added.
In September, Townhall covered how the Fed cut interest rates for the first time since COVID-19 lockdowns.
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