Recession-sized rate cut: U.S Fed to slash rates by 1% this year, says Bank of America

Recession in the United States has been a major point of concern for the stock markets in recent times, and the recent stock tumbling on Tuesday has set off alarms across the country. Tuesday has been the actually worst day since the August sell-off, according to AP, and this is not a very good sign for the current market scenario.

S&P 500 sinks again

The prices of S&P 500 fell by a significant 2.1% on Tuesday, upkeeping the decades-long trend of dismal performance by this asset in the month of September. According to a previous ET report, S&P 500 always had the tendency of dropping down a few notches in the month of September, while picking up the next year.

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US Fed planning on lowering rates

The US Fed is planning on lowering interest rates later this month, owing to the factors of conditioning the US economy, and combating recession in the country meanwhile. However, it is yet to be seen if the slashing of the interest rates would be able to solve the various underlying problems around the US economy.

Jobs report primary concern

The jobs report is currently the mainly eyes concept for the stock market this month and has beaten concerns around inflation, as the former has seen a trivial curve over the course of the past few weeks. Analysts at the Bank of America are of the opinion that the jobs report is extremely crucial in understanding how the recession could effect the United States, when it arrives. US Feds could be contemplating a full percentage point of cuts while planning on the interest rates this time, as per the belief of US traders, says AP.

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FAQs:

Has the prices of S&P 500 fallen?
Yes, the prices of S&P 500 stocks tumbled down by a major 2.1%, raising alarms across the stock markets, indicating a probable point of concern.

Does S&P 500 dip in September?
According to the long standing trend, S&P 500 stocks have the tendency of projecting a downward trend in the month of September.