Washington: The US Federal Reserve decided on Wednesday to slash the targeted range of the benchmark interest rate by 0.25 percent to 3.5-3.75 percent.
According to Kuwait News Agency, the rate-setting Federal Open Market Committee (FOMC) announced that the decision was influenced by indicators suggesting that economic activity has been expanding at a moderate pace. The committee noted a slowing in job gains for the year and a slight increase in the unemployment rate through September, with recent indicators aligning with these developments. Inflation has increased since earlier in the year and remains elevated.
The Committee emphasized its aim to achieve maximum employment and maintain inflation at a 2 percent rate over the long term. It acknowledged the high level of uncertainty regarding the economic outlook and expressed attentiveness to the risks affecting its objectives, particularly the increased downside risks to employment in recent months.
In support of these goals, the Committee decided to lower the target range for the federal funds rate by a quarter of a percentage point to between 3.5 and 3.75 percent. The Committee stated its commitment to evaluating incoming data, the changing outlook, and the balance of risks when considering further adjustments to the rate. It reiterated its dedication to supporting maximum employment and returning inflation to the 2 percent target.
The Committee also expressed its readiness to adjust the stance of monetary policy as necessary if risks emerge that could hinder the achievement of its goals. It affirmed that its assessments would incorporate a wide range of information, including labor market conditions, inflation pressures and expectations, and financial and international developments.