The Federal Reserve interest rate decision is due today at: 19:00 BST.
The Federal Reserve has a clear mandate from the U.S. Congress to promote maximum employment and to maintain price stability.
If inflation is too high, or it thinks it is heading that way, the Fed will raise interest rates. It will cut rates if it thinks there is a danger of economic growth slowing too much or inflation being too low.
Rate cuts make it more attractive for business to borrow to invest and for the consumer to borrow to spend. The Fed perhaps is key in trying to prevent a recession and in promoting a recovery if there is an economic slowdown.
Interest rate cut expected
Analysts expect the Fed to make an interest rate cur today but Jerome Powell, the Fed chairman, is unlikely to deliver the message markets want to hear on plans for future rate cuts.
A cut of 0.25% is expected.
Update
The Federal Reserve duly cut the interest rate by 0.25% as expected, only the second cut in eleven years, and both in the last two months. Needless to say, President Trump remained unimpressed – he tweeted, ‘Jay Powell and the Federal Reserve Fail Again. No “guts,” no sense, no vision! A terrible communicator!’
Oh dear!