Next Week, Interest Rates May Do Something They Haven't Done Since March 2020. It Could Foreshadow a Big Move in the Stock Market.

The U.S. Federal Reserve is mandated to take necessary actions that keep the Consumer Price Index (CPI) measure of inflation growing at an annualized rate of 2%. When the rate deviates too far from that target, the Fed adjusts the federal funds rate (overnight interest rates) to influence economic activity.The CPI started rising in 2021 and reached 8% in 2022 (the fastest growth pace in 40 years). In response, the central bank embarked on the most aggressive campaign to hike interest rates in its history. Fortunately, that policy response worked and the CPI has cooled significantly since then.Newer economic data is showing signs now that the Fed needs to make further adjustments, this time in the other direction. As a result, the Fed has signaled that it plans to cut interest rates at the conclusion of its next two-day gathering, which is scheduled for Sept. 17 and 18.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool