- US Fed cuts interest rates by half a percentage point
- The ECB also cut base rates
- Interest rates in Brazil are being raised
US Fed cuts interest rates by half a percentage point
The US Federal Reserve (Fed) cut its benchmark interest rates by half a percentage point on Wednesday.
This is the first cut since the beginning of the COVID-19 pandemic. Monetary policymakers voted to cut base rates to between 4.75% and 5%.
The financial institution stated that its rate-setting committee "has gained greater confidence that inflation is moving sustainably towards 2% and considers that the risks to the employment and inflation targets are broadly balanced".
However, Donald Trump, the Republican presidential candidate, hinted that the US central bank was playing political games by announcing a long-awaited interest rate cut of half a percentage point.
"I think it shows that the economy is in a very bad state that they should be cutting it so much unless they are playing political games," Trump commented in a New York Bitcoin bar. - Either the economy is very bad or they are playing political games, one or the other. But interest rates have been cut sharply."
The ECB also cut base rates
The Governing Council of the European Central Bank (ECB) also decided last week to cut the interest rate on the deposit facility by 25 basis points to 3.5%.
The interest rates for the main refinancing operations and the marginal lending facility were cut to 3.65% and 3.9%, respectively.
According to the ECB, this decision is based on the latest inflation data, which are in line with the June projections.
The Bank now forecasts average annual inflation in the euro area to reach 2.5% this year, 2.2% in 2025 and 1.9% in 2026.
Interest rates in Brazil are being raised
However, Brazil's central bank announced on Wednesday that it will raise base rates for the first time in two years to 10.75 percent.
The central bank of Latin America's largest economy raised the interest rate by a quarter of a percentage point.
Based on ELTA reports
