Fed to cut interest rate in 2019



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The Federal Reserve said on Wednesday that during this year possible low interest rates up to half a percentage point to respond to growing economic uncertainty and a reduction in inflation expectations.

The Fed has cast aside the promise of being "patient" by adjusting rates. Almost half of the members now show willingness to reduce borrowing costs over the next six months.

Even authorities that do not see a reduction in rates this year believe "that the argument has been reinforced to a more expansive monetary policy"Jerome Powell, the Fed chairman, told a news conference after the meeting.

"We will act as necessary … and we will use our tools to support the (economic) expansion," he added.

The Fed kept its interest rate in the range of 2.25 and 2.50 percent on Wednesday. This is the fourth time in a year that the institution decides not to change the fee.

The Fed vote was 9-1; James Bulliard, of the Federal Reserve of St. Louis, was inclined to a cut of rate, which represented your first disagreement since Fed Chairman Jerome Powell took office in February 2018.

Seven of the 17 members They said they hoped it would be appropriate to cut rates by half a percentage point by the end of 2019, and an eighth person saw a quarter-point rate cut.

While new economic projections showed that opinions on growth and unemployment remained broadly unchanged, inflation is now expected at 1.5 percent, down from the 1.8 percent projected in March.

In addition, officials anticipate that the inflation target of 2 percent will also not be reached next year.

The institution noted that uncertainties have increased over the prospects for sustained economic expansion. He said he will act as if appropriate to maintain this expansion with a strong labor market and inflation close to the target.

Powell said he intends to fulfill his four-year tenure against the Fed.

On Monday, sources told Bloomberg that the White House in February explored the legality of downgrading the Fed president shortly after US President Donald Trump talked about firing him.

Of the 98 experts surveyed by Bloomberg, 97 projected that the US Federal Reserve (Fed) would leave its benchmark rate in the same range, which has remained at that level since last December.

With information from Reuters.

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