Rate Cut Ruckus: Harris Hails Good News, Trump Sounds Economic Alarm
US Federal Reserve Cuts Interest Rate by 0.5% Points: Mixed Reactions from Democrats and Republicans
A Big Cut Before the Presidential Election: What Does it Mean for the Economy?
The US Federal Reserve’s decision to cut the base interest rate by 0.5% points has sparked mixed reactions from the Democratic and Republican parties. The move, which comes just before the presidential election in November, has been welcomed by the Democrats as “good news” for Americans who have suffered from high prices.
Democratic presidential candidate and Vice President Kamala Harris said in a statement, “This is good news for Americans who have suffered from high prices,” but added, “We know prices are still too high for middle and working-class families.” She emphasized that the fight against inflation would continue.
President Joe Biden also commented on the decision, saying, “We have reached a critical moment,” and “Inflation and interest rates are falling, but the economy is still strong.”
On the other hand, Republican presidential candidate and former President Donald Trump criticized the Federal Reserve’s decision, saying, “(A cut of 0.5 percentage points) means the economy is that bad, or the Federal Reserve is taking political action.” Trump has accused Federal Reserve Chairman Jerome Powell of trying to help the Democratic Party before the presidential election.
Chairman Powell refuted this in a press conference, saying, “The Federal Reserve always works for the people and does not consider anything else.” However, there are predictions that this announcement of a cut in interest rates may not be of much help to the ruling Democratic Party.
According to Reuters, among the six presidential elections held in years when interest rates were lowered since 1972, the only instance in which the candidate of the ruling party won was the re-election of former President Bill Clinton in 1996.