Are more interest-rate cuts likely to occur?
The Fed has been moving very aggressively lately — making an unprecedented three-quarters of a point cut on Jan. 22, followed by a half-percentage point cut Wednesday. It’s a measure of how serious Fed Chairman Ben Bernanke is about problems in the credit market and the threat of a recession. The Fed’s main policy-setting interest rate has been pushed down to 3 percent. Whether additional cuts follow depends on what happens in the broad economy, and, to a lesser extent, on the financial markets. In its statement Wednesday, the Fed left the door open to additional rate cuts by noting that despite everything it has done recently, “downside risks to growth remain.” The Fed will be looking closely for signs of deterioration in the job market. If the economy starts to shed jobs rather than generate new ones, the Fed may be cutting rates for the foreseeable future. Any particular advice for people nearing retirement age? Whether times are good or bad, financial advisers have the same fundame
