Fed may have prematurely declared victory over inflation after super-sized rate cut move

Fed may have prematurely declared victory over inflation 
after super-sized rate cut move


If consumer prices resume rising rapidly in the coming months, the world will blame its former economic saviour, Powell

THE US stock market soared not long after the Federal Reserve fulfilled the bulls’ wildest dreams and cut its benchmark rate by half a percentage point, a move that most major brokers deemed improbable just a few days ago.

But the market still ended on Wednesday (Sep 18) with modest losses, suggesting that investors are concerned that the central bank has prematurely declared victory over inflation and may have inadvertently given its foe succour.

The Fed pivoted to an accommodative policy, kicking off its rate-cutting cycle with a super-sized 50-basis-point cut.



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