The US Federal Reserve reduced interest rates by a quarter of a percentage point on Thursday, as policymakers observed a job market that has "generally eased" while inflation continues to trend towards the U.S. central bank's 2% target.
Fed officials have highlighted improved productivity as one of the key factors that has bolstered their confidence in the ongoing decline of inflation. Monetary policy has been tightened and remains restrictive to guide inflation back to the central bank’s 2% target — a process of "disinflation" that the Fed believes is still in progress.
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