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25 June 2024
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U.S Senators Urge Fed to Cut Interest Rates Ahead of FOMC Meeting

U.S Senators Urge Fed to Cut Interest Rates Ahead of FOMC Meeting

Elizabeth Warren, Jacky Rosen, and John Hickenlooper—three U.S senators—recently wrote to Federal Reserve Chair Jerome Powell, urging him to lower the Fed interest rate. At 5.5%, the current interest rate set by the Fed is the highest level in two decades. High borrowing rates, according to the senators, are making life even more difficult for working Americans.

Americans are feeling the pinch most acutely in the form of rising home and car insurance premiums. In addition, the current call for a rate decrease by the Fed follows a worldwide trend of central banks doing the same. The interest rate differential between the United States and Europe has become even wider when the European Central Bank cut rates from 4% to 3.75%.

All Eyes on Fed

A comparable action in the United States is therefore proposed by the senators. The senators expressed their disagreement with the Federal Reserve’s decision to maintain high interest rates, stating that it widens the gap between the US and Europe’s rates. They went on to say that monetary conditions might become tighter as a result of reduced interest rates driving up the currency.

An unprecedented eleven rate hikes have been implemented by the Federal Reserve since March 2022. Concerns about more economic hardship have been stoked by the Federal Reserve’s decision to retain its position on interest rates, despite mounting demands for reduction from lawmakers and scholars.

Bitcoin encountered firm opposition despite an aggressive effort to break the elusive $70,000 barrier, as the cryptocurrency saw a precipitous drop and is currently trading at $67,288 as per data from CMC. The crypto market is expected to see strong volatility this week due to investors’ and traders’ anticipation to analyse the US economic data.

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