August 22nd, 2019
Having an up-and-down week? Well, the Fed’s been having an up-and-down year, and right now it’s looking like they’re riding the down side. On Wednesday, the Federal Reserve released its minutes from its July 30-31 meetings, during which they decided to cut the Federals Funds rate by 25 bps, the first rate cut since the Great Recession hit roughly 11 years ago. The Fed cited three (3) main reason for its decision: 1) low wage growth and inflation, 2) slowdown in economic activity, and 3) trade policy risks and slowing global growth. Now, it appears the committee is looking to cut rates another 25 bps during their next meeting in September, and according to Capital Economics’ Senior U.S. Economist Michael Pearce, it could be because they are “petrified of upsetting the markets” and that “there is little sign that the Fed is willing to push back on the markets.” However, the Fed’s rate cut decision was not, and still isn’t, unanimous, as some members are calling for a larger cut while others are pushing for no cut at all. One thing that’s for sure: there is a LOT of uncertainty in the current economy and many volatile pressures pulling markets in different directions. So what should you do? Take one day at a time and stay focused on providing value and benefits to each and every customer you talk to. Focus on being an advocate and helping your customers achieve their financial goals, and let the market worry about itself.