Cut by 0.25%p...Fears of conflict with Trump during 'speed control'

Fed cuts benchmark interest rate by 0.25%p..."Growth 2.1% Next Year"

Expected strong exports due to increased U.S. demand...Domestic Interest Rates Affected

Fed likely to adjust interest rate policy pace from next year

Trump prefers low interest rates...Public criticism if interest rates are high

[Anchor]
The U.S. Federal Reserve wrapped up its monetary policy for the year by lowering its benchmark interest rate by a quarter of a percentage point at a regular meeting of the Federal Open Market Committee (FOMC).

The Fed is expected to speed up its rate cut from next year, raising the possibility of a clash with the Trump administration, which prefers low-interest rates.

I'll connect New York to find out more about the news. Correspondent Lee Seungyoon!

[Reporter]
Yes, it's New York.

[Encore]
So the Fed lowered interest rates further to stimulate the economy?

[Reporter]
Yes, it is.

The U.S. Federal Reserve cut its benchmark interest rate by 0.25 percentage point, concluding monetary policy this year, when it maintained an easing trend.

The biggest reason is the economic slowdown concerns.

U.S. consumption indicators have been good recently, but as employment indicators have slowed, the Fed has forecast growth of 2.1% next year, lower than this year.

The Fed has cut interest rates to stave off an economic downturn and boost the economy.

It is also cited as the reason behind the rate cut that price management has achieved some results.

The rate cut is expected to have a significant impact on consumption and investment.

Less loan interest burdens are expected to improve U.S. consumer sentiment at the end of the year and the beginning of the year and create conditions for companies to raise funds more aggressively.

[Anchor]
It is expected to affect our market a lot, right?

[Reporter]
Yes, it is.

If interest rates in the U.S. fall, it is expected to help stabilize the won-dollar exchange rate, which had soared due to the martial law crisis.

In addition, as global liquidity increases, it is expected to bring about investor sentiment in risky assets and have a positive impact on our stock market.

It is also expected to boost exports as it leads to increased demand from the United States, a major trading partner.

As the Korea-U.S. interest rate gap narrows to 1.5%p, it is expected to affect the Bank of Korea's decision to cut interest rates.

[Anchor]
Is there a chance that the Fed will start to speed up its rate cut next year and be at odds with Trump?

[Reporter]
Yes, it is.

This year, the Fed cut its benchmark interest rate by 0.5%p in September and 0.25%p in November, but it has cut it by a total of 1%p through three consecutive cuts so far this month.

But from next year, the Fed could begin to pace itself on interest rate policy, raising tensions between Fed Chair Jerome Powell and Trump, Bloomberg reported.

The Fed raised its key rate to 3.9% from 3.4% at the end of next year.

The expected inflation rate of 2.5% next year, higher than this year's management target of 2%, also seems to give a boost to rate pace-control theory.

In fact, the interest rate futures market is forecast to freeze in January next year at 81%, and then the Fed is forecasting to adjust rates at the FOMC in March by looking at price and employment indicators.

However, Trump has publicly criticized it if interest rates are not as low as he believes, as he prefers low interest rates.

When Trump's criticism of Powell reached its peak during his first term in office, the gap between the U.S. and the European Central Bank widened to the maximum.

The problem is that, following the ECB's key rate cut this month, ECB President Christine Lagarde recently hinted at further rate cuts.

As a result, as the dollar is already rising, there is a possibility that Trump's policy to increase exports to Europe through tariffs will not materialize as expected due to the strong dollar.

In addition, concerns that the tariff bomb and illegal immigrant deportations, the main policies of Trump's second term, will push up prices, which the Fed has been particularly concerned about, are also bolstering its rate policy pace-setting theory.

I'm YTN's Lee Seungyoon from New York.