Three US Senators Urge the Fed to Reduce Rates, Citing Economic Risks

IconCryptoNewsTerminal Staff11 Jun, 2024

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Three US Senators Urge the Fed to Reduce Rates, Citing Economic Risks

Three US senators, including Elizabeth Warren, have sent a letter to the Federal Reserve urging it to reduce interest rates. The letter, obtained by Coindesk, argues that the Fed's aggressive rate hikes have exacerbated inflation by making it more expensive to buy homes, build new construction, and secure auto loans. The trio of senators, which also includes Sherrod Brown and Jeff Merkley, wrote that the Fed's continued focus on its 2% inflation target is putting the US economy at risk of recession. They urge the Fed to look beyond this target and consider the broader economic impact of its policies. This call for lower interest rates comes amid growing concerns about the negative impact of the Fed's tightening cycle on the economy. Recent data has shown that inflation is starting to moderate, while economic growth is slowing. Critics of the Fed argue that it needs to be more cautious in its approach to rate hikes to avoid causing an unnecessary recession.

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