Fed Announces Rate Cut, Stock Market Tanks
This week the Federal Reserve announced a reduction in the interest rate of 0.25%, bringing it down to between 2.0 and 2.25%. Concurrent with the rate cut, the DOW declined by 736 points in 4 days. This came after a milder decline the previous week.
Typically, a reduction in the interest rate is coupled with a rise in the stock market. Why is it different this time?
Some are pointing to Trump’s announcement of additional tariffs on Chinese goods. However, that announcement was made the day after the rate reduction. The day of the…