Fed Slashes Interest Rates by Half a Percentage Point, First Cut in 4 Years

Policymakers said they have ‘gained greater confidence’ in their fight against inflation, expecting another 50-basis-point cut this year.

US Federal Reserve chairman Jerome Powell holds a press conference in Washington on Sept. 18, 2024. Mandel NGAN / AFP

The Federal Reserve has cut interest rates for the first time in four years after concluding its two-day policy meeting on Sept. 18.

Monetary policymakers kicked off their first easing campaign since the onset of the COVID-19 pandemic by lowering the benchmark federal funds rate by 50 basis points, to a range of between 4.75 percent and 5 percent. The decision affects interest rates on credit cards, auto loans, mortgages, and other financial products, as well as savings accounts.