The Federal Reserve begins its final policy meeting of the year, with the interest rate decision due Wednesday afternoon.
Despite high inflation, the Federal Reserve is expected to cut interest rates this week for the third straight meeting.
Cal State East Bay economics Professor Farhad Sabetan said interest rates are essentially the “engine for economic growth,” with lower rates encouraging investment and business, which in turn benefits everyone.
While the goal interest rate is typically 2%, Sabetan explained that the interest rates have been stuck at 3%, making the Federal Reserve’s choice important.
To adjust for inflation, the Federal Reserve must also inspect the markets to see whether interest rate cuts are possible or needed. This means it is possible that the Federal Reserve may skip a cut this time around due to new inflation fears.
“What they’re trying to do is to gradually lower the interest rate given the …