Risk or strategy? The Fed assesses reducing rates despite inflationary pressure
Washington, D.C. – The Federal Reserve of the United States (Fed), under the direction of Jerome Powell, finds itself at a delicate crossroads. Despite persistent signs of inflation, the institution is preparing for a new interest rate cut, generating debate and testing its economic balance strategy.
With interest rates currently between 4.50% and 4.75%, speculation surrounds a possible reduction of a quarter point in December. This decision comes in a complex economic context. While domestic consumption shows strength and the U.S. economy overall appears robust, inflation figures continue to raise concern. The consumer price index (CPI) increased to 2.7% in November, a clear sign that the battle against rising prices is far from over.
This outlook is further complicated by the anticipated return of the former president to the political scene, which intensifies the debate over economic policies and exerts additional pressure on the Fed. The institution thus finds itself between the need to control inflation and the risk of stifling economic growth, a precarious balance that Powell and his team must manage with caution.
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