World girds up for Fed's 1st rate cut since '20

Discussions on Sep 17-18 will likely centre around whether to reduce rates by 25 or 50 basis points

The world economy's tectonic plates will shift this week when a US easing cycle begins, just as officials from Europe to Asia set policy against a backdrop of brittle markets.

A 36-hour monetary rollercoaster will start with the Federal Reserve's probable decision to cut interest rates on Wednesday, and finish on Friday with the outcome of the Bank of Japan (BOJ)'s first meeting since it raised borrowing costs and helped sow the seeds of a global selloff.

According to the AFP report, the US Congress mandates that the central bank ensure stable prices and sustainable employment through independent action.

The debate among policymakers on September 17-18 will likely centre on whether to move the cut by 25 or 50 basis points(bps), the report added.

However, either number would be significant since March 2020, when it cut rates to near-zero in to bolster the US economy during the Covid-19 pandemic.