US Federal Reserve tipped to cut rates as inflation cools

The US Federal Reserve System is expected to cut interest rates by 0.75 per cent – signalling inflation is cooling enough to reduce borrowing costs. The announcement comes as Federal Reserve officials voted unanimously to leave rates unchanged at the 23-year high of 5.25 to 5.5 per cent. A policy statement from the Federal Reserve cited job gains remaining 'strong' as well as unemployment remaining 'low' following the decision. This comes as the US inflation rate is 3.2 per cent. The Fed clarified it does not expect it will be “appropriate” to reduce the target range until it has gained greater confidence that inflation is moving sustainably towards the two per cent goal.