Here's what the Fed should do about rates: Nothing
A Federal Reserve benchmark rate cut is expected to be announced on Wednesday after the Fed completes its two-day Federal Open Market Committee meeting.
A trader works ahead of the closing bell on the floor of the New York Stock Exchange, June 19, 2019 in New York City.The Federal Reserve is not just at a crossroads — it is at an absolute crossroads. The headline economic numbers show sustained growth and strong job creation. A net addition of 224,000 jobs last month, an unemployment rate sitting near a 50-year low and moderate inflation.
The economic reasons for cutting rates at this time are subtle. Fed officials, such as Chicago Fed President Charles Evans, argue that because the inflation rate has been consistently below the Fed's 2% target, the central bank's price stability mandate calls for at least one or two rate cuts this year.
Shooting bullets into the air now to scare off any potential threats would leave the Fed without any ammunition should those threats actually materialize.
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