Home
[size=36]US interest rates cut for the first time in 11 years[/size]
Economy | 10:01 - 03/08/2019
Follow up - Mawazine News
The global economic scene has been mixed with the Federal Reserve's decision to cut interest rates by a quarter percentage point, for the first time since October 2008, to a range of 2% to 2.25%.
Less than a day later, US President Donald Trump announced the introduction of customs tariffs on more than $ 300 billion of Chinese imports.
Al Jazeera Net is trying to explain these developments in the form of Q & A.
What does US interest rate cuts mean after 11 years?
As was widely expected, the Federal Reserve's decision to cut interest rates by 25 basis points (a quarter of a percent) was the first cut in more than a decade of interest rates as it has not experienced any cut since 2008.
Why have interest rates been cut?
The Federal Reserve confirms that its decision to cut interest rates is not at all related to any political rhetoric or positions of President Donald Trump.
Trump has been attacking the council for not taking a step to cut rates early.
Many experts blame the move on uncertainties about global growth and continued low rates that prompted Federal Reserve Chairman Jerome Powell to cut interest rates.
Despite the overall improvement in the US economy, especially in terms of unemployment and earnings from equity and bond markets, the US economy is slowing growth.
The US economy grew by only 2.1% in the last quarter, below the 3.1% achieved in 2018.
The interest rate cut is a pre-emptive step that reflects a major state of concern about global economic growth rates and continued low inflation.
How did Trump respond to the decision to cut?
Trump said the Fed chairman "let us down" by cutting interest rates by only a quarter percentage point, and noted that the market was waiting for a further decline.
"The thing the market wanted to hear from the board is that this is the beginning of a long and sustained cycle of interest rate cuts that will be in line with China, the EU and other countries around the world," Trump said in a tweet a few hours after the board issued its statement.
Less than a day later, US President Donald Trump announced the introduction of customs tariffs on more than $ 300 billion of Chinese imports.
Al Jazeera Net is trying to explain these developments in the form of Q & A.
What does US interest rate cuts mean after 11 years?
As was widely expected, the Federal Reserve's decision to cut interest rates by 25 basis points (a quarter of a percent) was the first cut in more than a decade of interest rates as it has not experienced any cut since 2008.
Why have interest rates been cut?
The Federal Reserve confirms that its decision to cut interest rates is not at all related to any political rhetoric or positions of President Donald Trump.
Trump has been attacking the council for not taking a step to cut rates early.
Many experts blame the move on uncertainties about global growth and continued low rates that prompted Federal Reserve Chairman Jerome Powell to cut interest rates.
Despite the overall improvement in the US economy, especially in terms of unemployment and earnings from equity and bond markets, the US economy is slowing growth.
The US economy grew by only 2.1% in the last quarter, below the 3.1% achieved in 2018.
The interest rate cut is a pre-emptive step that reflects a major state of concern about global economic growth rates and continued low inflation.
How did Trump respond to the decision to cut?
Trump said the Fed chairman "let us down" by cutting interest rates by only a quarter percentage point, and noted that the market was waiting for a further decline.
"The thing the market wanted to hear from the board is that this is the beginning of a long and sustained cycle of interest rate cuts that will be in line with China, the EU and other countries around the world," Trump said in a tweet a few hours after the board issued its statement.
What impacts on the US financial and labor sector?
The cut in interest rates has frustrated investors and the US financial markets and some are likely to see that the cut came "in the middle of the monetary policy cycle" and not the beginning of a new cycle.
"There is probably at least one more cut," Jerome Powell told a news conference after the Federal Reserve meeting.
The Standard & Poor's 500 Index and the Dow Jones index posted the biggest one-day drop in their trading in the past two months after Wednesday's cut, Reuters reported.
What about the impact of the cut on the American consumer?
The reduction decision means a reduction in the interest rates imposed on car loans or credit cards.
As for mortgage interest rates linked to government bond prices, they are not expected to fall.
US consumer spending accounts for two-thirds of the country's economy, and spending is now strong and is not expected to increase.
What can improve is the US business investment rate and increased spending, and more Americans will see the returns of the economic improvement their country has been experiencing in the last 10 years.
What impacts on the global economy?
The global economy is witnessing a slowdown similar to that of its US counterpart, and the US Reserve Bank is closely monitoring the steps and positions of central banks around the world.
According to Bloomberg, many financial experts in emerging market countries believe that the Fed's decision is somewhat negative for developing countries' assets, assuring traders that interest rates in the US will not see further large declines, which could reduce the transfer of investments from US assets To emerging market assets.
What is the relationship between reducing interest rates in the trade war between Washington and Beijing?
Most economists do not believe there is a direct link between US interest rate cuts and the US-Beijing trade war.
The cut in interest rates has frustrated investors and the US financial markets and some are likely to see that the cut came "in the middle of the monetary policy cycle" and not the beginning of a new cycle.
"There is probably at least one more cut," Jerome Powell told a news conference after the Federal Reserve meeting.
The Standard & Poor's 500 Index and the Dow Jones index posted the biggest one-day drop in their trading in the past two months after Wednesday's cut, Reuters reported.
What about the impact of the cut on the American consumer?
The reduction decision means a reduction in the interest rates imposed on car loans or credit cards.
As for mortgage interest rates linked to government bond prices, they are not expected to fall.
US consumer spending accounts for two-thirds of the country's economy, and spending is now strong and is not expected to increase.
What can improve is the US business investment rate and increased spending, and more Americans will see the returns of the economic improvement their country has been experiencing in the last 10 years.
What impacts on the global economy?
The global economy is witnessing a slowdown similar to that of its US counterpart, and the US Reserve Bank is closely monitoring the steps and positions of central banks around the world.
According to Bloomberg, many financial experts in emerging market countries believe that the Fed's decision is somewhat negative for developing countries' assets, assuring traders that interest rates in the US will not see further large declines, which could reduce the transfer of investments from US assets To emerging market assets.
What is the relationship between reducing interest rates in the trade war between Washington and Beijing?
Most economists do not believe there is a direct link between US interest rate cuts and the US-Beijing trade war.
» "Financial News" Posted by KTFA Members 10-25-2021
» Frank26, MilitiaMan and Petra: "One Small Piece will Ignite the World" 10-25-2021
» Al-Sadr tweeted: The next government must provide a comfortable life, and the people must cooperate
» THE PRESIDENCY OF THE REPUBLIC REVEALS THE FATE OF THE CORRUPTION REVENUE RECOVERY ACT
» Telegrams to the next deputy
» Ports announce the date for the completion of the "Silk Tunnel", the largest and first of its kind i
» For the second day.. Central bank sales of the dollar increased
» What are the chances of Al-Kazemi in the second term? A member of the Sadrist movement answers
» Al-Sadr reveals the features of the next government and warns!
» The Ministry of Electricity issues new instructions regarding employee salaries
» Bribery in Iraq is getting worse...Achievement versus payment
» Reports: Iran is installing a destructive weapon in Iraq in preparation for the major battle
» A source reveals an upcoming merger of the two largest Sunni alliances in Iraq
» PRESIDENCY OF THE REPUBLIC: THE CONSTITUTION HAS IDENTIFIED THE CANDIDATE OF THE LARGEST BLOC TO FOR
» THE SADRIST MOVEMENT SETS THE CONDITIONS FOR AN ALLIANCE WITH THE POLITICAL BLOCS
» AL-KAZEMI PLEDGES TO SPEED UP THE PASSAGE OF LAWS THAT SERVE THE CATEGORY OF SHORT STATURE
» BORDER CROSSINGS ANNOUNCE THEIR ACTIVITIES DURING THE PAST 24 HOURS
» Details of amending the cabinet decision regarding the sports city donated by the Saudi King
» AL-SADR: OUR FUTURE POLICY IS TO DEAL FIRMLY IN ACCORDANCE WITH THE LAW
» THE PRESIDENCY OF THE REPUBLIC REVEALS THE FATE OF THE CORRUPTION REVENUE RECOVERY ACT
» IRAQ.. NEW SECURITY PLANS TO PROTECT LOGISTICAL SUPPORT LINES
» IN THE DOCUMENT.. 8 INVESTMENT LICENSES WERE WITHDRAWN IN NAJAF
» THE COUNCIL OF MINISTERS HOLDS ITS REGULAR SESSION
» AL-KAZEMI’S ADVISOR SETS A CONDITION FOR OVERCOMING THE PLANNED DEFICIT IN THE 2022 BUDGET
» GOVERNMENT TALKS TO MODERNIZE THE TRANSPORT SYSTEM
» BELONGING TO THE FUND FOR THE CARE OF MINORS.. JUSTICE IS CONSIDERING ESTABLISHING A NUMBER OF PROJE
» AL-KAZEMI AND HIS LEBANESE COUNTERPART DISCUSS ECONOMIC AND TRADE COOPERATION BETWEEN THE TWO COUNTR
» “URGENT” CLARIFICATION FROM FINANCE REGARDING HEALTH INSURANCE DEDUCTIONS
» A PLAN FROM THE MINISTRY OF CONSTRUCTION TO ADDRESS THE PROBLEM OF ROADS OUTSIDE THE GOVERNORATES
» IRAQ AND IRAN DISCUSS MARITIME FACILITIES IN THE SHATT AL-ARAB
» THE FIRST OF ITS KIND IN THE MIDDLE EAST..THE PORT ANNOUNCES THE DATE OF COMPLETION OF THE “TAHRIR T
» “SHOCKING FIGURES” FOR THE DIVORCE RATE IN IRAQ
» America hopes to form the new Iraqi government according to the results of the elections and the dec
» 19 Iraqi banks get a rating from international agencies
» For the third month, Iraq is among the largest exporters of oil to China
» Iraq concludes a contract to drill dozens of oil wells and increase its production by 800,000 barrel
» The increase in the trade exchange at the Mandali port to 200%
» Al-Kazemi's advisor comments on a Shafak News report on "digital currencies" and warns against one o
» Baghdad comments on an international report that listed Iraq among the most hungry countries in the
» Turkey reassures: We will not monopolize water on Iraq and it should use it optimally
» Karmian and two governorates.. the decline in pomegranate production and economic losses for farmers
» The Iraqi Stock Exchange is trading shares of two billion dinars in a week
» The "fifth" round of Iraqi-Saudi talks on the Gulf electrical connection
» Iraqi Oil Minister: We aim to invest 2.6 billion cubic feet per day by 2026
» Association of Private Banks: Banks granted loans worth 747.3 billion dinars for 8612 projects
» The government's agricultural plan faces criticism... and calls for solutions
» Iraq announces that it will stop burning associated gas “permanently” in 2025
» The stability of the dollar exchange rates in Baghdad and its decline in Kurdistan
» The increase in central bank sales of the dollar
» Al-Muthanna is launching a campaign to eradicate the phenomenon of livestock breeding in cities
» Al-Sadr presents solutions to address the agricultural and industrial reality
» The Electoral Commission will start the manual counting process, starting tomorrow
» Turkey and Iran are behind the decision.. A shocking decision for farmers and farmers to cut the win
» The Commission recommends dismissing 86 new appeals against the election results
» The US State Department issues a statement on threats to the United Nations mission in Iraq
» The Presidency of the Republic determines a way to supplement the state treasury with funds
» State of Law: The Commission did not come up with anything new regarding the election results
» Relative stability of the dollar exchange rates in the local markets
» Optimistic forecasts for oil prices at the end of 2021
» After a rally, oil returns to the red zone
» Significant increase in central bank sales of hard currency
» In pictures.. The central bank tower reaches its final height and is the highest in Iraq
» Iran resumes sending visitor campaigns to Iraq a day after lifting the visa
» A high-ranking security delegation arrives in Erbil for an expanded meeting
» Statistics .. a significant increase in divorce rates in Iraq
» US Ambassador: We paid $10 million for the success of the Iraqi elections
» Oil prices are rising
» After a rally, oil is declining and optimistic expectations for prices at the end of 2021
» Generalization of the credit card reader on cash transactions
» MilitiaMan Sunday Night "A Flip of the Switch May be All that is Needed" 10-24-2021
» The Iraq-China agreement enters into force to build 1,000 schools
» Iraq and Spain discuss cooperation in 7 sectors
» Al-Kazemi’s advisor: The current labor law is classic and old and needs updating
» Water Resources: We will sue Iran in the International Court to establish our water rights
» The Sadrist Movement: The next government will be the government to implement the government program
» Jamal Kojer: Kurdish political forces will negotiate the formation of the government after determini
» Victory Coalition: The coordination framework meeting is not to create a political alliance or a lar
» Coordination Framework Forces: We call on the President of the Republic to intervene to prevent the
» Iraq completes contracts for 87% of solar energy projects, leaving only 1 giga.. 5 international com
» Establishment of 209 new national companies and registration of 25 foreign company branches during l
» The dollar continues to decline and gold fluctuates in Kurdistan markets
» Digital transformation in the central bank and the banking sector
» The Prime Minister of Spain praises the "economic reforms" of the Al-Kazemi government
» THE SADRIST MOVEMENT TO THE GERMAN AMBASSADOR: WITHOUT FIGHTING CORRUPTION, THE STATE CANNOT BE REFO
» THE STATE OF LAW REJECTS THE “ESCALATION” AND REVEALS THE FILES OF THE COORDINATION FRAMEWORK MEETIN
» AL-MAWARID ANNOUNCES THE ENTRY INTO FORCE OF THE “WATER” MEMORANDUM OF UNDERSTANDING WITH TURKEY
» AL-SADR PROPOSES SOLUTIONS TO REFORM THE REALITY OF THREE VITAL SECTORS IN IRAQ
» IRAQ AND SAUDI ARABIA ARE DISCUSSING A NUMBER OF JOINT INVESTMENT PROJECTS IN THE FIELD OF ENERGY
» Association of Private Banks: Banks granted loans worth 747.3 billion dinars for 8612 projects
» The UAE hosts a global economic conference with the participation of international leaders
» The fact that the Sadrist bloc attended the meeting of al-Maliki's house
» Planning and experts downplay the importance of the World Food Program report
» The Electoral Commission sets the date for the start of the procedures for the manual counting of th
» The Coordination Framework and its allies renew their rejection of the election results, and the Shi
» More than 5 million citizens vaccinated against Corona
» An international organization: 8.5 million Iraqis live in areas contaminated with mines and explosiv
» Specialists: Delaying the formation of the government will negatively affect the Iraqi economy
» Confusion over a global report that placed Iraq among the 7 most hungry countries in the world