QCI #018 - And The Fed Acts

1 basis point is one one-hundredth of a percentage point or one percent.

1 bps = 1/100 of 1% or 0.0001

100 bps = 1%

Basis points were created to remove confusion when discussing percentage points accross financial products.

Here's the point: this week, the Federal Reserve Bank of the United States cut rates by 25 bps for the first time since late 2024, meaning that we are getting closer to the end of this COVID-19 recession. Leading to rallies in the tech and growth sectors by 1% to 2% across indices.

I wrote an article detailing how Fed Rates Cuts impact the economy downstream here: https://www.linkedin.com/pulse/what-yield-curve-peter-nunes/

Furthermore, trade tensions between US-China eased and a new ownership framework for TikTok emerged in Madrid supporting investor risk (risk of existing investors divesting) appetite.

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Quant Compass.