The economy is a tough and complex thing sometimes. In times of turbulence or high inflation, the US central bank typically adjusts interest rates. This controls spending since it determines how expensive it is to loan money.
Just recently they reduced interest rates by one-half percent. This means it’s cheaper to borrow money — more spend and that in turn drives the economy. Hooray for debt and spending! The Fed hopes this will prevent a recession. And, since the US is the world’s largest economy, it affects other economies, too. Will it work? It may or may not. The US housing market is fragile and may not recover its slowdown.
>> Read an explanation of the US interest rates at BBC News
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