September 19, 2019 Comments Off on Federal Funds Rate Drops for Second Time in 2019 Views: 743 National News, Top National

Federal Funds Rate Drops for Second Time in 2019

Citing global issues and “muted inflation pressures,” the Federal Market Open Committee of the Federal Reserve dropped the federal funds target rate for the second time in 2019. The committee cut the rate by a quarter percentage point, putting the target range at 1.75%-2%. The move means the federal funds target rate has dropped 50 basis points since July 2019.

The Fed indicated that job gains remain solid, with the unemployment rate low. Still, while household spending has increased, “business fixed investment and exports have weakened,” the Fed noted. The Fed also noted that, while sustained economic activity is the most likely outcome, “uncertainties about this outlook remain.”

A statement from CBRE indicated that, while cross-border transaction volumes have been negatively impacted, the interest rate reduction “should translate into lower borrowing costs.” Further reductions in short-term interest rates would also help alleviate liquidity issues in short-term markets, CBRE added.

Read more at Federal Reserve

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