What kind of ripple effect will the Federal Reserve's interest rate cuts have on things like borrowing, spending, saving, and investing? 

The Federal Reserve announced Wednesday that they will reduce the federal funds rate by 50 basis points (or 0.50%). This is an impactful move as it follows an increase of 500 basis points (or 5.0%) over the last several years, resulting in a cooling off of the U.S. economy as the Federal Reserve continues its efforts to reach their target of 2.0% inflation.

The NEW activity MOVE: Interest Rate Ripple Effect will engage students in understanding the role of the Federal Reserve in managing inflation, the primary tool it uses to reach its target of 2.0% inflation (the federal funds rate), and how interest rate changes impact the economy. 

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Want to brush up on your knowledge of the Federal Reserve? Start our On-Demand module The Fed: Bank of Banks.

About the Author

Ryan Wood

Ryan is the Partnerships and Adoption Manager for Next Gen Personal Finance’s midwest region. He brings his experience as a former teacher, curriculum designer, and sales and marketing professional to state organizations and school districts in supporting the implementation of their personal financial education efforts. He graduated from the University of Wisconsin-Green Bay and earned his teaching credential from Saint Mary’s University in Winona, Minnesota. He proudly taught at two rural high schools in Wisconsin before transitioning to curriculum design at NGPF, and is now excited to be on the front lines in delivering the best possible financial education in the midwest. He and his wife have three beautiful daughters, each of which inspire him to share the impact of being sound financial stewards both at home and as lifelong learners.

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