The head of the U.S. Federal Reserve, Powell, pledges reductions in crucial interest rates.
The Head of the Fed declared, "I spot inflation headed towards a stable 2% return." The financial institution has established 2% as its desired inflation rate. As a result of the significantly elevated inflation rate, they boosted the interest rates to 5.25% to 5.5% by July 2023, marking the highest level in 23 years, and have kept it at that level since then.
Lately, inflation in the States has been on a downward trend, hitting its lowest point in over three years in July. As per the CPI index released by the Labor Department based in Washington, consumer prices went up by 2.9% annually. In contrast to June's 3.0% annual increase in the CPI index, the increase in May was substantial at 3.3%.
Given the current decrease in inflation, the Federal Reserve might consider reducing the interest rate to stimulate economic growth. Despite the decrease in inflation, the interest rate remains at its highest level in 23 years due to the previous efforts to combat inflation.
