Select Language

Powell speech: If economy remains solid, we can dial back pace of cuts

blockHeadVisual
  1. HOME
  2. Get information
  3. World FX news
  4. Powell speech: If economy remains solid, we can dial back pace of cuts

World FX news

search
Breaking news

Powell speech: If economy remains solid, we can dial back pace of cuts

  • X
  • facebook
  • LINE
  • RSS
  • X
  • facebook
  • LINE
  • RSS
New update 2024.09.19 03:40
Powell speech: If economy remains solid, we can dial back pace of cuts

update 2024.09.19 03:40

Federal Reserve Chairman Jerome Powell explains the decision to cut the policy rate, federal funds rate, by 50 basis points to the range of 4.75%-5% after the September meeting and responds to questions in the post-meeting press conference.

Key quotes

"Our projections are not a plan or decision."

"We will adjust policy as necessary."

"If the economy remains solid, we can dial back the pace of cuts; equally, if the labor market deteriorates, we can respond."

Interest rates FAQs

Interest rates are charged by financial institutions on loans to borrowers and are paid as interest to savers and depositors. They are influenced by base lending rates, which are set by central banks in response to changes in the economy. Central banks normally have a mandate to ensure price stability, which in most cases means targeting a core inflation rate of around 2%. If inflation falls below target the central bank may cut base lending rates, with a view to stimulating lending and boosting the economy. If inflation rises substantially above 2% it normally results in the central bank raising base lending rates in an attempt to lower inflation.

Higher interest rates generally help strengthen a country's currency as they make it a more attractive place for global investors to park their money.

Higher interest rates overall weigh on the price of Gold because they increase the opportunity cost of holding Gold instead of investing in an interest-bearing asset or placing cash in the bank. If interest rates are high that usually pushes up the price of the US Dollar (USD), and since Gold is priced in Dollars, this has the effect of lowering the price of Gold.

The Fed funds rate is the overnight rate at which US banks lend to each other. It is the oft-quoted headline rate set by the Federal Reserve at its FOMC meetings. It is set as a range, for example 4.75%-5.00%, though the upper limit (in that case 5.00%) is the quoted figure. Market expectations for future Fed funds rate are tracked by the CME FedWatch tool, which shapes how many financial markets behave in anticipation of future Federal Reserve monetary policy decisions.

 

Date

Created

 : 2024.09.19

Update

Last updated

 : 2024.09.19

Related articles

Show more

Writer

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?
No loading Yes loading

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Previous article

prev

Powell speech: Upside risks to inflation have diminished

Next article

Powell speech: Nothing in our projections that suggest we are in a rush

prev

Most viewed

AUD/JPY attracts some sellers to near 97.00 as BoJ maintains rates steady

The AUD/JPY cross loses ground around 97.05, snapping the four-day winning streak during the Asian trading hours on Friday.
New
update2024.09.20 13:19

GBP/JPY falls to near 189.00 following the BoJ interest rates decision

GBP/JPY breaks its four-day winning streak, trading around 189.00 during the Asian session on Friday.
New
update2024.09.20 12:59

GBP/USD Price Forecast: Bulls retain control near 1.3300 mark, highest since March 2022

The GBP/USD pair trades with a positive bias for the third straight day on Friday and hovers around the 1.3300 mark during the Asian session, just below its highest level since March 2022 touched the previous day.
New
update2024.09.20 12:54

Australian Dollar recovers losses following PBoC interest rates decision

The Australian Dollar (AUD) recovers its daily losses and extends its winning streak against the US Dollar (USD) following the interest rate decision by the People's Bank of China (PBoC) on Friday.
New
update2024.09.20 12:14

EUR/JPY slides to mid-158.00s after BoJ policy decision, lacks follow-through

The EUR/JPY cross ticks lower after the Bank of Japan (BoJ) announced its policy decision this Friday and moves away from over a two-week high, around the 160.00 psychological mark touched the previous day.
New
update2024.09.20 12:12

NZD/USD flat lines around 0.6235-6240 area, remains close to monthly top set on Thursday

The NZD/USD pair seesaws between tepid gains/minor losses through the Asian session on Friday and currently trades around the 0.6235-0.6240 region, well within the striking distance of the monthly peak touched the previous day.
New
update2024.09.20 11:52

Japan's Suzuki: Will continue to monitor, analyze impact of US rate cut on Japanese economy, financial markets

Japan's Finance Minister Shunichi Suzuki said on Friday that he "will continue to monitor and analyse impact of latest US rate cut on Japanese economy and financial markets." "FRB's view on US economy in line with Japanese government's view that the US economy is likely to expand," he added.
New
update2024.09.20 11:31

USD/INR weakens as likely inflows boost Indian Rupee

The Indian Rupee (INR) extends its upside on the weaker US Dollar (USD) on Friday.
New
update2024.09.20 11:22

Gold price consolidates near record high, bullish potential seems intact

Gold price (XAU/USD) regained positive traction on Thursday and rallied back closer to the all-time peak touched the previous day in reaction to the Federal Reserve's (Fed) decision to start the policy easing cycle with an oversized rate cut.
New
update2024.09.20 11:18

Japanese Yen holds gains ahead of the BoJ interest rate decision

The Japanese Yen (JPY) edges lower against the US Dollar (USD) following the National Consumer Price Index (CPI) data released on Friday.
New
update2024.09.20 10:42

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

arw
  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Line

Line
Facebook

Facebook
X

Twitter
Cancel