On September 18, the U.S. Federal Reserve (the Fed for short) cut interest rates for the first time since the onset of the COVID-19 pandemic in 2020. The half-point reduction, bringing rates down from about 5.5% to 5.1%, promises to bring big economic changes to the United States and beyond, with big impacts on consumer borrowing and spending. We used our social listening and analytics solution to dive deeper into this highly-anticipated financial news.
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How big is the news about the interest rate cut?
When it comes to conversation about U.S. federal interest rate cuts, the past several weeks have undoubtedly been the busiest. Since early August, there have been a handful of spikes in mentions from both social and news sources, with the largest coming on September 18, the day the Fed officially voted to cut rates.
Zooming in to look at the two months leading up to the announcement, there were six significant, preliminary spikes:
- August 2: Mentions spiked four times higher than average as the U.S. Department of Labor reported a rise in the unemployment rate, sparking fears of an imminent recession and a worsening job market.
- August 5: Mentions spiked seven times higher than average as the U.S. stock markets saw their worst day since 2022 and the Japanese stock market saw its worst day since 1987.
- August 14: The conversation saw a 196% increase in mentions with the release of a Consumer Price Index report showing that inflation rates fell below 3% for the first time in nearly three years.
- August 23: Mentions increased by 103% after Fed chair Jerome H. Powell made statements indicating that a rate cut was coming soon.
- September 5: Mentions spiked three times higher than average with the release of another jobs report showing that unemployment rates fell from 4.3% to 4.2% in a month.
- September 11: There was a 279% increase in mentions as the Labor Department reported that inflation dropped to its lowest level since 2021.
The news of the interest rate cut on September 18, understandably, caused the highest spike, with a 667% increase in mentions.
What are people saying about the interest rate cut?
On September 18, the day the rate cut was announced, non-neutral sentiment was slightly more negative than positive.
On the positive side of the conversation, some of the most engaging posts celebrated the cut and its potential impact on the economy, as well as its timing ahead of the U.S. presidential election.
This post on X generated more than 3,000 engagement actions and had an estimated reach of about 427,000.
On the negative side, some of the most engaging posts criticized the timing of the cut for being too close to the U.S. presidential election, and thus partisan. Some also interpreted the cut as an indication of the economy’s vulnerability.
This post on X generated more than 1,200 engagement actions and had an estimated reach of about 147,000.
As time goes on, the impact of the rate cut will become clearer as more consumers take to social media to discuss the effects they see in their own lives. Interested in keeping up with the conversation? Try a free demo of the Meltwater Suite to see how your organization can put these insights to work.
