Federal Reserve cuts interest rates, what does this mean for future economy?

(WTRF) — The Federal Reserve has cut interest rates by 50 basis points, but what does this mean for the economy and how does this affect spending power?

Managing director Jason Haswell says that the Fed’s job is to make sure inflation is under control and that the labor market and economy are going at a good pace.

He says with this cut, less restrictive rates will free up the money supply and allow variable rate items like a line of credit or a mortgage to become more affordable.

“This will help to loosen up rates on mortgages, credit cards, business loans, things like that so that people – those monthly bills will begin to finally drop. So that will help moderate things a bit and help stimulate the economy a little more because it puts more money in their pockets and allows them to spend at a better pace.”

Jason Haswell, managing director, The Monteverde Group

Haswell says the economy is like an aircraft carrier, it takes a while to turn. He says people will begin to see the effects of the basis point drop over the next few months.

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