US cuts interest rates as Trump election raises uncertainty

Interest rates on US debt have already jumped this week, reflecting those concerns.

The Fed’s key rate – what it charges banks for short-term borrowing – sets a benchmark for lending across the economy, influencing how banks set interest rates for credit cards, mortgages and other loans.

Those borrowing costs have been hovering at the highest rates in two decades, after the Fed rapidly hiked rates in response to inflation in 2022, bringing its key rate to roughly 5.3%.

The cut announced on Thursday, which was widely expected, lowered rates by 0.25 percentage points.