The Federal Reserve Board (FRB) will reduce the policy interest rate induction target by 0.25% to “1.75-2.00% per year” at the Federal Open Market Committee (FOMC) on the 18th Decided. Measures following the previous July's decision to cut rates for the first time in about 10 and a half years. Although it is a result of emphasizing risks such as trade disputes between the US and China, opinions on the need for additional mitigation are also divided within the FRB.
Powell explained at the press conference after the session, "Take preventive measures against ongoing risks." He explained that the previous “preventive rate cut”, which was decided to cut interest rates as an “insurance” in anticipation of the risk of intensifying friction between the US and China, will also be maintained this time.
However, US stock prices remain at the highest level, and the unemployment rate remains at a low level. Of the 10 vomc participants with voting rights, seven, including Mr. Powell, agreed to cut the additional rate, but two turned to the opposite insisting on the policy rate unchanged. The remaining one objected to this decision from the standpoint of a higher rate cut of 0.50%.
Meanwhile, US President Trump, who demanded a strong monetary easing from the FRB to stimulate the economy and criticized Mr. Powell as “stupid,” said immediately after the decision, “Powell and the FRB were messed up again. "There is no judgment and no vision!" He showed that the rate cut was not enough.
FOMC participant 1 at this meeting ...