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Here's what would happen to the US economy if there are no rate cuts this year

·1 min

Federal Reserve officials are hesitant to cut interest rates in light of last month’s unexpected rise in inflation, according to Fed Chair Powell. The prospect of rate cuts, which had initially led to market highs, now appears to be slipping away. The continuation of high interest rates may have a negative impact on the US economy, as it can discourage borrowing, reduce profits, and cause stock market declines, leading to delayed investments and cost-cutting by businesses. Higher rates also increase borrowing costs, impacting consumer spending, business investment, and the housing market. However, not all experts believe that the economy requires rate cuts to avoid a recession.