The post Fed’s Daly: It’s time to consider adjusting borrowing costs appeared on BitcoinEthereumNews.com.

Federal Reserve Bank of San Francisco President Mary Daly said that the US central bank needs to take a gradual approach to lowering borrowing costs, per Financial Times.   Key quotes Daly calls for a “prudent” approach to lowering rates Pushes back on economists’ concerns that the US economy is heading for a sharp slowdown that warrants rapid cuts in interest rates. Gradualism is not weak, it’s not slow, it’s not behind, it’s just prudent.  After the first quarter of this year, inflation has just been making gradual progress toward 2 percent.  The Fed did not want to overtighten into a slowing economy. No need for a dramatic response to the weakening labor market. Market reaction  The US Dollar Index (DXY) is trading 0.03% higher on the day at 102.45, as of writing. Fed FAQs Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback. The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining…

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Filed under: News - @ August 19, 2024 12:38 am