How Fed Rate Cuts Affect The Global Economy

The Federal Reserve manages interest rates to influence financial conditions within the United States. But those decisions can also affect the posture of other central banks because many aspects of international finance rely on U.S. dollars. As the world moves away from a global round of economic tightening, central bankers in the U.S. are seeking to extend the economic expansion, which is among the strongest in the world.

Chapters:
[00:00-00:45] Cold Open
[00:45-02:48] Chapter 1: Economic tightening
[02:48-05:26] Chapter 2: The carry trade
[05:26-07:52] Chapter 3: The world’s lender of last resort
[07:52-09:41] Chapter 4: Other currencies

Produced and Edited by: Carlos Waters
Supervising Producer: Lindsey Jacobson
Animation: Christina Locopo
Additional Footage: Federal Reserve Bank of Kansas City, Getty Images
Additional Sources: Bank for International Settlements, Boston University, Council on Foreign Relations, Federal Reserve Bank of New York, Harvard Law School, International Monetary Fund, Massachusetts Institute of Technology, University of Chicago, PIMCO, Sovereign Wealth Fund Institute, Tax Foundation, White House

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How Fed Rate Cuts Affect The Global Economy

39 Comments

  1. US is a candle burning from both ends, or a sinking ship where everyone has prepared to go overboard when it's time. Too early or too late would cost one, both an arm and a leg.

  2. US socialism on full display. In a socialist economic model, the production of goods and services is either partially or fully regulated by the government; this is referred to as central planning, and the economic structure that is created is known as a planned economy or a command economy.

  3. What it will do is keep over valued homes over valued , possible that home value will increase again. This is all because of the trump administration lowered interest rates to much and caused a huge demand making real estate skyrocket along with building materials. When the demand goes up the price goes up. Interest rates are fine right where they are. Homes are unaffordable now because of the over valued price.

  4. Several months ago I decided to actually research house Democratic party Policies,I compared that to what they tell us, There Total Lier's,I can't be part of the Lier Class, I'm shocked I don't support Liers

  5. So, we're supposed to believe that the FED keeps wages in check. Obviously, they're not doing much to check those record profits for the CEO's and shareholders.
    "They got money for wars, but can't feed the poor." – Tupac

  6. The Only Opportunity I See Is From The United Kingdom With The Wealthiest That Religion ☮️🕎🔯☪️🛐🕉️ Show them where the economy need fixing particular i see what they mean by transparent 🪟 "different."

  7. Man, these Fed rate cuts are really starting to mess with everything. I mean, sure, they were supposed to help, but now I’m feeling the pinch everywhere. My savings account is basically giving me nothing, and the stock market’s all over the place.

  8. 2015 Canada vs 2024 Canada . like Gentle horse vs sick donkey

    too little and toolate .Never vote Liberals & NDP .
    LIMA SCAM , Unlimted Refugees live in Hotel & international students
    on the other hand 6% unemployment in canada
    home crisis ,crime up & no doctor and schools

  9. Our economy is struggling with uncertainties, housing issues, foreclosures, global fluctuations, causing instability. Rising inflation, sluggish growth, and trade disruptions need urgent attention from all sectors to restore stability and stimulate growth.

  10. It became the most important because of Breton Woods and the fact that John Maynard Keynes lost there. Since the international currency became the Dollar, the FED – who controls the Dollar – also controls the world's economy. The FED's interest rates are, therefore, the rates that set other countries' interest rates. Really funny to hear CNBC not mentioning developing and poor countries on a video about the "global economy". Poor and developing countries have to increase their interest rates to 3 to 4 times that of the FED. Paul Volker's 1970s-1980s interest rate hike may have caused more pain and death around the world than many of the US military adventures abroad.

  11. Central Bank's e-currencies are the same as paper currency – it changes nothing about the strength of a currency – specially because international transactions are already electronic.

  12. Please… if you’re going to interview anyone such as Freya Beamish, have them use their phone. Freya’s webcam sound and visual quality is awful. It’s hard to listen to them when the sound is utterly abrasive. Insist they use their phone instead as it’ll no doubt be superior audio and video quality.

  13. I've always been fascinated by how top investors achieve millionaire status through their investments. Currently, I'm sitting on $345K from a home sale and I'm torn between investing in stocks or holding out for a better opportunity.

  14. Sounds like a skeptical outlook on things then. With the rate cuts do you think it's best for us who are not conservative investors to focus on bonds or dividend stocks? I want to reallocate my 7-figure portfolio and I preferably want the assets with the best ROI.