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Should the Fed Have Lowered Interest Rates?



On July 31st, the Federal Reserve announced its decision that it would lower interest rates. Since then, many people have predicted that interest rates would continue to fall. Morgan Stanley, an investment banking company, has conjectured that the Fed will lower interest rates in September, even nearing 0% in the future.


The Federal Reserve has been subject to controversy over its decision, with some people believing that lowering interest rates is not the best move currently. This is due to a strong economy, with GDP growth at 2%. Although output did slow down, it seems that it is too early to start lowering rates. Lowering interest rates is currently the Fed's primary option to alleviate recessions, setting interest rates too low could leave the Fed cornered.

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