US Fed makes larger half-point cut in first rate reduction since 2020

The US central bank has lowered interest rates for the first time in more than four years with a bigger than usual cut. The Federal Reserve reduced the target for its key lending rate by 0.5 percentage points, to the range of 4.75%-5%.

It will be a relief to US borrowers, who have been dealing with the highest interest rates in more than two decades. Federal Reserve Chair Powell said the aggressive action on Wednesday was intended to make sure that high borrowing costs, put in place to fight inflation, would not end up hurting the US economy.