On Wednesday, for the second time this year, the Federal Reserve is poised to cut interest rate as policymaker try to get ahead of economic risk present from the global slowdown, US President Donald Trump’s trade war and uncertainty about the road ahead.
“Will Fed ever get into the game? Dollar strongest EVER! Big Interest Rate Drop, Stimulus!” Trump said in a tweet Monday.
This week, the Fed which operates independently of the White House is expected to cut rates slightly to a range between 1.75% and 2%, in a bid to insulate economic growth as threats to the outlook mount. That remains far above Trump’s previously stated desire for zero or negative interest rates.
There are two members of policy-setting Federal Open Market Committee which voted against the Fed’s cuts July rate that its first cut in more than decades and may dissent against any further reduction during this meeting, the economy is growing and unemployment has to remain near 50 years low. On the other hand, a committee member has voiced support for a larger-than-expected move in the face of global risks.