US goes big with first interest rate cut in four years

Officials signalled that further cuts were likely to follow before the end of the year.

The Fed raised interest rates sharply in 2022, aiming to cool the economy and stabilise prices, which were then surging at the fastest pace since the 1980s.

But officials have gained confidence that inflation, the rate at which prices rise, is now headed back toward their 2% target.

Last month, the head of the bank, Jerome Powell, set the stage for the cut, saying “the time had come” for a policy adjustment.