By Viram Shah
The Federal Reserve’s recent decision to cut interest rates by 0.5% is a significant shift, marking the first reduction in four years. This decision doesn’t just affect the U.S. economy; it has global implications that investors should pay attention to. Let’s explore how these rate cuts impact international markets, starting with currency exchange rates.
How Does This Affect Currency Exchange Rates?
One of the most immediate effects of a Fed rate cut is the weakening of the U.S. dollar (USD). When interest rates fall, dollar-denominated assets become less appealing to global investors. This can push the dollar down against other currencies.
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