Fed cuts rates by 50 basis points
I got an interview for IBD tomorrow afternoon in London. So in case i get asked regarding this, ill just state my views on this, and if im wrong do correct me, or if theres anything else i need to know please let me know.
So Interest rates have got cut twice in two weeks, shows the Feds concerns with US economy going into recession. Lower interest rates, makes it more incentive for people to borrow (cheaper to get loans/mortgages) and cheaper for firms to invest (through borrowings) and makes it less of an incentive to save.
Also im kinda guessing as interest rates go down in US, it makes it less attractive for bonds, so US Dollar (forex) will get lower, making imports more expensive to the US, and exports cheaper (competitive). Less spending on imports means more spending in domestic economy (US).
All aspects trying to relieve any hopes of Recession!
Anything else i should know?!
(IBD Summer internship interview)
Appreciate your time and input!
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