Federal Reserve Significantly Slashes Benchmark Interest Rate

The key rate now sits at an estimated 4.8%. That is down from a two-decade high of 5.3%.

The Federal Reserve has finally slashed it benchmark interest rate.

After months of sitting steady, the key rate now sits at an estimated 4.8%. That is down from a two-decade high of 5.3%.

It remained steady for 14 months as it struggled to curb the worst inflation streak in four decades.

Inflation fell from a peak of 9.1% mid-2022 to a three-year low of 2.5% last month, which is not far ahead of the fed’s 2% target.

The unusually large half-point drop marks the first time Fed’s cut rates in over four years. It’s also a dramatic shift after over two years of high rates that help tame inflation but also made borrowing intensely expensive for American consumers.