What the Fed’s rate cut means for consumers, businesses and investors

The Federal Reserve is poised to cut interest rates this week for the first time in four years, putting an end to its longest cycle of rate hikes in roughly a decade.

Economists predict the central bank will lower borrowing costs during its meeting this week, bringing its benchmark rate down from its current level of between 5.25 and 5.5 percent, its highest in more than 20 years. The long-anticipated move is expected to allay some fears about persistent inflation, a cooling labor market and a potential slowdown in economic growth.

“This will improve the material well-being of all Americans,” said Joe Brusuelas, chief economist at RSM US. “We had three years of extremely aggressive policy out of the Fed. We’re now pivoting toward the normalization of rates in the post-pandemic economy.”

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