With the US inflation coming down to about 3%, the Fed has said it's likely done raising interest rates.
👉 Background: The US Federal Reserve is the central bank of the USA— the equivalent of the Reserve Bank of Australia. And, when inflation started rearing its ugly head, the Federal Reserve went hard on raising its key interest rates.
👉 What happened: The US Federal Reserve whipped up their interest rate over 5.20% in just 18 months. And as a result, the amount of consumer debt in the US hit a record of over $17 trillion USD.
👉 What else: Now, with the US inflation coming down to about 3%, the Fed has said it's likely done raising interest rates. And even better than that, they signaled three interest rate cuts in 2024.
💡When the Fed sneezes, the world catches a cold. And when the Fed flexes, the world gains a whole lot of confidence.
💡The US is the largest economy in the world. Its GDP is almost 50% greater than the second country on the list, China. And the interest rate set by the Federal Reserve is the most impactful lever that can be pulled.
💡For example, both US share markets were up over 1%—which is worth hundreds of billions. But on the other hand, US dollar, which many countries rely on, dropped more than 1% against major currencies.
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