Biden Describes Rate Cut as ‘Significant Day for the Nation’

On Thursday, President Joe Biden responded to the Federal Reserve’s recent decision to cut interest rates by describing it as an “important signal” regarding the cooling of inflation. However, he cautioned that while this is a positive development, it indicates that the work to bolster the economy is far from over.

Speaking at the Economic Club of Washington, D.C., Biden emphasized the significance of the day’s announcement. “Yesterday was an important day for the country,” he stated, noting that after two and a half years of the Fed raising interest rates, the central bank has now begun to lower them.

Biden expressed optimism about this shift, stating, “I think it’s good news for consumers, and that means the cost of buying a home, a car, and so much more would be going down. And it’s good news in my view, for the overall economy.”

Throughout his remarks, the president reflected on the progress made since the onset of the COVID-19 pandemic. He highlighted previous challenges faced by the country, such as supply chain disruptions, soaring costs of essentials, and shortages of baby formula. He also took the opportunity to review his legislative accomplishments, including the American Rescue Plan, the Inflation Reduction Act, the Chips and Science Act, and the Bipartisan Infrastructure Law.

Biden pointed out significant changes in inflation rates, noting, “At its peak, as you all know, inflation was 9.1% in the United States. Today it’s much closer to 2%.” While he acknowledged the improvements, he stressed that there is still much to be done. “No one should confuse why I’m here. I’m not here to take a victory lap. I’m not here to say, ‘A job well done.’ We do have more work to do,” he declared.

White House Chief of Staff Jeff Zients further elaborated on the administration’s focus looking ahead. During a call with reporters, he noted that both Biden and Vice President Kamala Harris recognize ongoing challenges, particularly concerning the costs of childcare and housing.

Questions about the implications of rising unemployment in light of the Fed’s rate cut were also raised during the call. A White House official dismissed these concerns, stating that current data from the Fed indicates a robust labor market and highlighted that unemployment rates have remained the lowest on average compared to any administration in the past five decades.

Further inquiries regarding potential setbacks to the economy stemming from escalating tensions in the Middle East were met with cautious optimism from the official. They acknowledged that while such geopolitical risks are consistently monitored, the current assessment indicates that the economy is in a healthy state. “The kind of range of risks, while we continue to monitor them, do not pose a significant risk to the outlook,” the official commented.

Additionally, Biden made an inaccurate claim during his speech, stating that he has “never once spoken to the chairman of the Fed since I became president.” This contradicts reality, as Biden met with Jerome Powell in the Oval Office in May 2022.

The reactions to the Fed’s decision and the administration’s ongoing strategies reflect a blend of cautious optimism and acknowledgment of the challenges that remain ahead. With continued efforts on various economic fronts, the administration aims to address the pressing needs of American families while fostering broader economic recovery.

Source: ABC News