On Air Now

Listen Now

Weather

cloudy-day
58°
Overcast
H 74° L 56°
  • cloudy-day
    58°
    Current Conditions
    Overcast. H 74° L 56°
  • clear-day
    67°
    Afternoon
    Sunny. H 74° L 56°
  • clear-night
    71°
    Evening
    Clear. H 74° L 56°
Listen
Pause
Error

News on-demand

00:00 | 00:00

Listen
Pause
Error

Traffic on-demand

00:00 | 00:00

Listen
Pause
Error

Weather on-demand

00:00 | 00:00

Business
Fed officials were sharply divided over September rate cut
Close

Fed officials were sharply divided over September rate cut

Fed officials were sharply divided over September rate cut
Photo Credit: AP Photo/Thomas Peipert
FILE - In this Oct. 4, 2019, file photo Federal Reserve Chairman Jerome Powell attends a panel at the Federal Reserve Board Building in Washington. On Wednesday, Oct. 9, the Federal Reserve releases minutes from its September meeting when it cut interest rates for a second time this year. (AP Photo/Jacquelyn Martin, File)

Fed officials were sharply divided over September rate cut

Federal Reserve officials were sharply divided last month when they decided to cut their key policy rate for a second time this year, a split that indicates the path forward for future rate cuts remains cloudy.

Minutes of the discussion at the September meeting released Wednesday showed that the majority of Fed officials believed a second quarter-point cut was appropriate given increased economic uncertainty from trade tensions and a slowing global economy.

However, a "couple" of participants indicated they favored a half-point reduction. They said the larger rate cut would reduce the risks of a possible recession.

But a third group of "several participants" argued that the Fed should not be cutting rates at all, saying that the current outlook for the economy had changed little since the central bank's last meeting.

This rare three-way split on the Fed's top policy panel indicates that Fed Chairman Jerome Powell may face challenges in reaching consensus on future moves on rates.

Many investors are hoping the Fed will cut rates for a third time this year when it meets again at the end of this month. The Fed's benchmark rate currently stands in a range of 1.75% to 2% with the next meeting coming on Oct. 29-30.

The CME Group, which tracks futures trading on the Fed's policy rate, is currently putting the chance of a third cut in October at around 84%.

Chris Rupkey, chief financial economist at MUFG, a global financial group, said, "We would bet that Powell will deliver the third rate cut the markets are clamoring for on Oct. 30 but rate cuts beyond this ... start to look less like the insurance style cuts" that Powell has referred to.

Michael Pearce, senior U.S. economist at Capital Economics, said he found the minutes "noticeably ambivalent" about the timing of the next cut. He said many Fed officials may be nearing the limits of how far they are comfortable cutting rates in the face of trade uncertainty and would prefer to "wait instead for more concrete signs of weakness in the incoming data."

The September rate cut, which followed a cut in July that was the first in a decade, was approved on a 7-3 vote. Two Fed officials, Esther George, president of the Fed's Kansas City regional bank, and Eric Rosengren, president of the Boston bank, dissenting in favor of no cut.

James Bullard, president of the St. Louis regional bank, dissented in the other direction, arguing that the threats to the economy were large enough that a bigger cut was needed.

The minutes however showed that there were other Fed officials who disagreed over the quarter-point rate cut although not strongly enough to dissent.

Following custom, the Fed does not name the Fed officials cited in the minutes, which were released after the customary three-week delay following a meeting.

The minutes showed officials also discussed the turbulence in a short-term funding market called the repo market that occurred in the week the central bank was meeting.

In remarks this week, Powell has said the Fed will be taking moves to deal with this turbulence.

The minutes showed that among the options discussed would be to allow the Fed's balance sheet to grow again. The Fed had been reducing its holdings that had surged to a peak of $4.5 trillion in the wake of the Great Recession as it engaged in several rounds of bond purchases aimed at lowering long-term rates and giving the economy a boost.

Those bond purchases were known as "quantitative easing." Powell said that while various options were being weighed for providing more stability for the short-term funding markets, the effort should not be considered a new round of quantitative easing.

Read More

News

  • Philadelphia police are searching for answers after a baby was critically injured in a shooting Saturday night, authorities said. >> Read more trending news   According to WPVI-TV, the 11-month-old's stepmother said she was driving in the city's Hunting Park neighborhood when gunfire erupted about 8 p.m. The baby, who was inside the vehicle, suffered gunshot wounds to the chest, head and buttocks, authorities said. The stepmother said she became aware of the child's injuries after parking about a mile north of the shooting site, the Philadelphia Inquirer reported. Someone then took the woman and baby to a nearby hospital, authorities said.  The baby, who was later transferred to an area children's hospital, remains in critical condition, according to the Inquirer. Police have not arrested any suspects, WPVI reported.  Read more here or here.
  • Last year, after mounting pressure to address the impact of screen time on young users, Apple released a new feature that tracks how long users look at their phone each day. (Although, many teens have found loopholes to circumvent the monitoring system sometimes used by parents). >> Read more trending news  But, of course, it’s not just young people who are spending oodles of hours in front of a screen. Nearly 30% of adults in the United States say they are online “almost constantly,” according to a Pew Research Center poll. And another Pew study reported screen time was increasing among adults over 60. The potential drawbacks of too much screen time are well-documented: Studies have linked it to depressive symptoms for adolescents and overall sleep disruption. In addition, too much exposure to blue light — the wavelengths emitted from phones and computer screens — may also be causing accelerated aging, even if you’re not looking directly at it, a new study suggests.  The study, published Thursday in “Aging and Mechanisms of Disease,” found that blue light could be damaging to cells in the brain, as well as the eyes. The researchers looked at how fruit flies responded to 12 hours of exposure to blue LED light. In the study, the flies that were exposed to 12 hours of light, followed by 12 hours of darkness did not live as long as those kept away from the blue light all together. Exposure to blue light also affected the flies’ ability to conduct common behaviors, such as climbing walls. Some flies used in the experiment were eyeless and even those subjects had brain damage after being exposed to the light.  “It was very clear cut that although light without blue slightly shortened their lifespan, just blue light alone shortened their lifespan very dramatically,' researcher Jaga Giebultowicz said. Fruit flies are frequently used in similar studies because of their cellular makeup and development is similar to humans and other animals.  'And with the prevalent use of LED lighting and device displays, humans are subjected to increasing amounts of light in the blue spectrum since commonly used LEDs emit a high fraction of blue light,” Giebultowicz said.  In order to curb risk, the researchers suggest that people get plenty of exposure to natural light, which is important for maintaining the body’s natural circadian rhythm. 'As science looks for ways to help people be healthier as they live longer, designing a healthier spectrum of light might be a possibility, not just in terms of sleeping better but in terms of overall health,” researcher Eileen Chow said. In addition to getting outside for some Vitamin D, researchers also suggest people wear glasses with blue light protection when looking at screens and check the settings on devices to block blue light emissions. 
  • He was able to “Get Out,” and survived the “Black Panther” — and Okoye — so Daniel Kaluuya’s next project might leave some people scratching their heads. >> Read more trending news  Kaluuya is partnering with Mattel Films and Valparaiso Pictures on a live-action movie about Barney, the giant purple dinosaur who famously loved us from 1992 through 2009. “Barney was a ubiquitous figure in many of our childhoods, then he disappeared into the shadows, left misunderstood,” Kaluuya said Friday in a statement announcing the movie. “We’re excited to explore this compelling modern-day hero and see if his message of ‘I love you, you love me’ can stand the test of time.” According to Mattel Films’ Robbie Brenner: “Working with Daniel Kaluuya will enable us to take a completely new approach to ‘Barney’ that will surprise audiences and subvert expectations. The project will speak to the nostalgia of the brand in a way that will resonate with adults, while entertaining today’s kids.” Kaluuya was nominated for an Academy Award for his 2017 performance in “Get Out.” In 2018, he played W’Kabi — friend of T’Challa and the love of Okoye — in Marvel’s Atlanta-filmed “Black Panther.” Social media had mixed reactions to the announcement, so many that Barney was a trending topic by Friday afternoon.
  • The Houston Astros and Washington Nationals will face off in the 2019 World Series, starting with two games at Houston's Minute Maid Park before the teams head to Nationals Park in D.C. Want to follow all the action in the best-of-seven series? Here's what you need to know: >> Read more trending news  When and where are the games? Major League Baseball has released the following dates and start times for the Fall Classic: Game 1: Washington at Houston, 8:08 p.m. EDT Oct. 22 Game 2: Washington at Houston, 8:07 p.m. EDT Oct. 23 Game 3: Houston at Washington, 8:07 p.m. EDT Oct. 25 Game 4: Houston at Washington, 8:07 p.m. EDT Oct. 26 Game 5 (if needed): Houston at Washington, 8:07 p.m. EDT Oct. 27 Game 6 (if needed): Washington at Houston, 8:07 p.m. EDT Oct. 29 Game 7 (if needed): Washington at Houston, 8:08 p.m. EDT Oct. 30 What channel? Fox will televise the series. Fans also can tune in via ESPN Radio. What do I need to know about the teams? The Astros are no stranger to the playoffs, making appearances in four of the last five postseasons and winning the championship in 2017, according to ESPN. 'We're going back, to #TakeItBack!!' the team tweeted early Sunday.  Washington, meanwhile, is hoping to win the World Series for the first time in Expos/Nationals franchise history, despite appearing in five of the last eight postseasons, The Associated Press reported. The city hasn't had a team make it to the series since 1933, when the Washington Senators faced – and lost to – the New York Giants, according to MLB.com. – The Associated Press contributed to this report.
  • Bruce Springsteen made a boss move Saturday night, surprising a group of movie goers at an opening screening of his movie “Western Stars.” >> Read more trending news  Springsteen, a native of Freehold, delighted fans Saturday night at the screening at the AMC Loews Freehold Metroplex Cinema, the Asbury Park Press reported. “Thanks for coming out, thanks for supporting me all these years and enjoy ‘Western Stars,’” Springsteen told cheering fans, the Asbury Park Press reported. The film is a series of live concert performances by Springsteen of songs from his album “Western Stars.” The movie is set for wide release Oct. 25. 
  • After widespread backlash and concerns, President Donald Trump on Saturday said he will not be using his Miami golf resort as a host site for the 2020 G-7 Summit. >> Read more trending news  “We will begin the search for another site, including the possibility of Camp David, immediately,” Trump said on social media. “Thank you.” The White House announced Thursday that the meeting would take place at Trump National Doral Miami, a golf resort owned by the president.