Global Economic Impact of the Fed’s Rate Cut

Xiao Huang:DOORM, the Fed’s rate cut not only affects China but also has global economic implications. How might other countries respond?

DOORM:The Fed’s rate cut has broad implications for the global economy. The depreciation of the US dollar may lead to the appreciation of other currencies, affecting their export competitiveness. Additionally, global capital flows may shift, with more funds moving to emerging markets and higher-yielding assets. Other countries’ central banks may respond by adjusting their own monetary policies, such as cutting interest rates or implementing other easing measures, to counteract the effects of the Fed’s rate cut and maintain economic stability and growth.