Kicking off an expected loosening of U.S. monetary policy, the Federal Reserve cut interest rates by half a percentage point on Wednesday.
The move brings a larger-than-normal reduction in the cost of borrowing, which followed growing concern about the health of America’s job market.
Farm Policy News says higher interest rates have hit the agricultural sector much harder than the rest of the U.S. economy.
Interest rates during the last two years have been at a high point not seen in decades, not only increasing farmers operating costs but also helping to fuel fund managers’ record short positions in corn, soybeans, and wheat.
Industry experts say the half-percent rate cut is a good start for easing the price pressures on agriculture.
Policymakers see the Fed’s benchmark rate falling another half a percentage point at the end of 2024, another full point in 2025, and by a half-percentage point in 2026.
