US Federal Reserve: On the finish line

Article by Carsten Klude

The time has come: although the US Federal Reserve has left interest rates unchanged, it has left the door wide open for a rate cut at its next meeting on September 18. "A rate cut at the next meeting in September is on the table." In our view, the time has long since come to cut interest rates. Given the significant fall in the inflation rate, the real key interest rate, which best reflects how expansive or restrictive monetary policy is, is at such a high level that in the past it has almost always led to a recession. 

In this issue of "Economic Situation & Strategy", we take a closer look at US monetary policy.