Market Reactions to Federal Reserve Rate Cut

This chapter examines the immediate effects of a 50-basis-point rate cut by the Federal Reserve on various financial markets, including the S&P 500 and bond yields. It analyzes contrasting projections from the FOMC and discusses the implications on the dollar's strength and mortgage applications. Additionally, the chapter delves into the complexities of inflation, the labor market, and potential risks to economic stability following this significant monetary policy shift.