Breitbart Business Digest: What The Election Means for Fed Policy

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The Federal Reserve’s decision to cut interest rates by a half-percentage point on Wednesday is widely seen as the start of a loosening cycle for monetary policy. A big question is, with one party capturing the White House but facing a majority opposition in the House or Senate or both, will not have a big effect. The Fed in that case is seen as pursuing the path it laid out in the Summary of Economic Projections.

Even if you do not share the view that tariffs and immigration restrictions are a drag on the economy—a view we definitely do not support—it’s likely that the Trump policy mix of tax cuts, regulatory reforms, and economic nationalist trade and border measuresthat would allow for lower interest rates than have prevailed under the Biden-Harris administration.

Vice President Kamala Harris delivers remarks on the one-year anniversary of the Inflation Reduction Act on August 15, 2023, in Seattle. reduce incentives to invest and therefore shrink supply—which significantly increased under the Biden-Harris administration—are also likely to continue to provide inflationary impulses into the economy..

 

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