Picture courtesy of Wikipedia

 

The US Federal Reserve trimmed interest rates by a quarter point on Wednesday, marking the third reduction this year, amidst evident divisions within the bank over economic management. The decision, passed by a nine-to-three vote, puts the rates in a range of 3.5% to 3.75%, highlighting internal uncertainty as the US faces major economic upheavals, including trade tariffs and labour market changes.

 

Fed Chair, Jerome Powell, aimed to project unity among the Federal Open Market Committee (FOMC), but the split vote reveals differing opinions on future policy. Current projections indicate hesitance toward further rate cuts next year, which may strain relations with the White House. Economic challenges include Trump's tariffs and shifts in labour dynamics due to immigration policies, as well as additional pressure from inadequate data caused by the government shutdown.

 

Recent data captures a slight rise in inflation from 2.3% to 3% and an increase in unemployment from 4% to 4.4%, posing a dilemma for the Fed. High interest rates might stall economic growth, while rapid cuts could spur inflation. Trump, who has publicly pressured the Fed for lower rates, suggests current high prices stem from previous administration policies, contrasting some corporate assertions linking price hikes to tariffs.

 

Tensions have eased since the Fed’s rate cuts in September and October, yet Powell has cautioned about the fragile balance between employment goals and inflation. Minutes from the October Fed meeting highlighted “strongly differing views” on policy direction, with some members advocating for cuts to move towards neutrality and others questioning their necessity.

 

Looking forward, Powell’s term ends in May, allowing Trump to nominate a successor. Kevin Hassett, a potential nominee and National Economic Council director, is under consideration, though his support among Republicans is uncertain. A decision is expected within weeks.

 

Key Takeaways

 

• The Fed cut interest rates by a quarter point amidst internal division.
• Rising inflation and unemployment complicate future economic strategies.
• Powell's term ends in May, with the potential for a new Fed Chair nomination.

 

  Adapted by ASEAN Now from The Guardian 2025-12-11

 

 

 

18 minutes ago, webfact said:

Trump, who has publicly pressured the Fed for lower rates, suggests current high prices stem from previous administration policies, contrasting some corporate assertions linking price hikes to tariffs.

 

As Fed Chair, Jerome Powell, pointed out in his speech, current high prices stem from tariffs, while inflation without the tariffs would be just slightly above 2%. Also, the Fed wants to balance out possible inflation risks with a gradually weakening labor market.

There goes $ vs. ฿ again. Last couple of months the $ been dropping like a stone against the ฿. Lower interest rates in the US mean another downdraft. All meals to be bought at 7/11 henceforth. 

The stock market rallied nicely with the news. In all reality that's what matters most to the retirees in Thailand.

2 hours ago, EVENKEEL said:

The stock market rallied nicely with the news. In all reality that's what matters most to the retirees in Thailand.

Most retirees in Thailand don't own stocks. They're SS check to SS check. That's why they can't move to a different country and stay here and bitch on AN about everything.

The US gov is swimming in debt and that is why rates dropped again.  Inflation is evident everywhere.  And there is no fed independence whatsoever.  Trump is even interviewing the future chief presently.  What a charade.

2 hours ago, EVENKEEL said:

The stock market rallied nicely with the news. In all reality that's what matters most to the retirees in Thailand.

 

Do MAGA eyes see something different from others?

 

35 minutes ago, koolkarl said:

Trump is even interviewing the future chief presently.  What a charade.

 

And Trump even openly announced that he will decide the new fed president on his willingness to cut rates.

 

https://www.reuters.com/world/us/trump-says-support-interest-rate-cuts-is-key-test-fed-chair-nominee-2025-12-09/

 

WASHINGTON, Dec 9 (Reuters) - U.S. President Donald Trump said support for immediately cutting interest rates would be a requirement for anyone he chose to lead the Federal Reserve, according to a Politico interview published on Tuesday.

Asked if it was a litmus test that the new central bank chair immediately lower interest rates, Trump told the news outlet "yes".

 

 

1 hour ago, CallumWK said:

 

Do MAGA eyes see something different from others?

 

The dow had a 500 pt bump with the interest news. Go be a gloomy guss elsewhere.

10 hours ago, gargamon said:

Most retirees in Thailand don't own stocks. They're SS check to SS check. That's why they can't move to a different country and stay here and bitch on AN about everything.

Perhaps the circle of people you know, but there are many well off retirees here as well. If you retired with a 401K plan, you have stocks.

4 hours ago, EVENKEEL said:

Perhaps the circle of people you know, but there are many well off retirees here as well. If you retired with a 401K plan, you have stocks.

It’s still not healthy to have trump strong arming interest rates it’s better in my view to keep this function of government out of the hands of politicians especially the corrupt ones.

15 hours ago, CallumWK said:

 

Do MAGA eyes see something different from others?

 

Once the news was released, the market saw a nice little jump.   Why must we always try to pour cold water on everything? 

 

 

Dow closes nearly 500 points higher after Fed cuts rates: Live updates

 

https://www.cnbc.com/2025/12/09/stock-market-today-live-updates.html

1 hour ago, Fact said:

Once the news was released, the market saw a nice little jump.   Why must we always try to pour cold water on everything? 

 

 

Dow closes nearly 500 points higher after Fed cuts rates: Live updates

 

https://www.cnbc.com/2025/12/09/stock-market-today-live-updates.html

 

Hey Franky, I only posted the results of the day after. You want to say they were fake?

 

Let's talk again when I post the month after results.

Stocks climbed because interests on debt went lower, and I mean the massive debt the AI companies have built up.

Wait 1 or 2 months for that bubble to burst, and see where the stock market goes then.

 

https://finance.yahoo.com/news/five-debt-hotspots-ai-data-180514503.html

 

Five debt hotspots in the AI data centre boom

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