Markets rally after Fed hints at cutting interest rates


The Federal Reserve is here to save the day — at least on Wall Street.
U.S. stocks had one of their best days of the year on Tuesday, The Wall Street Journal reports, despite the recent anxiety that has spilled over ever since President Trump has announced his latest tariff binge, which had previously sent stocks and bond yields into a bit of a tailspin. That's because Federal Reserve officials have hinted that the Central Bank could lower interest rates if the economy slows in response to the protectionism, alleviating some fears. Fed Chairman Jerome Powell said the agency is "closely monitoring" the implications of the tariffs and will "act as appropriate" to keep the economy afloat.
The market's rally also occurred after several Republican members of Congress said they do not support potential new tariffs on goods coming from Mexico, The Washington Post reports.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
The Dow Jones Industrial Average jumped 512 points, or 2.1 percent, just two trading days after hitting its lowest point since late January. The S&P 500 rose 58.82 points, also 2.1 percent, while the Nasdaq Composite grew by 194.10 points, a 2.6 percent increase. It was the biggest one-day advance for all three indexes, the Journal reports.
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Tim is a staff writer at The Week and has contributed to Bedford and Bowery and The New York Transatlantic. He is a graduate of Occidental College and NYU's journalism school. Tim enjoys writing about baseball, Europe, and extinct megafauna. He lives in New York City.
-
July 13 editorial cartoons
Cartoons Sunday's political cartoons include new TSA rules, FEMA cuts, and Volodymyr Zelenskyy complimenting Donald Trump's new wardrobe
-
5 weather-beaten cartoons about the Texas floods
Cartoons Artists take on funding cuts, politicizing tragedy, and more
-
What has the Dalai Lama achieved?
The Explainer Tibet’s exiled spiritual leader has just turned 90, and he has been clarifying his reincarnation plans
-
Dollar faces historic slump as stocks hit new high
Speed Read While stocks have recovered post-Trump tariffs, the dollar has weakened more than 10% this year
-
Economists fear US inflation data less reliable
speed read The Labor Department is collecting less data for its consumer price index due to staffing shortages
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off