Central Banks Around World Consider Cutting Interest Rates

A growing number of countries' central banks have already lowered or are considering cuts in interest rates in the coming days and weeks, signaling growing concerns that global economic growth is slowing.

[READ: Fed Announces First Rate Cut Since 2008]

On Wednesday the U.S. Federal Reserve cut its key interest rate by a quarter point, marking the first time reduction since the financial crisis. While interest rates are a measure intended to boost consumption and spending, experts say the U.S. economy is already strong and other measures, such as ending the trade wars with China, might yield the same results with fewer risks.

Also on Wednesday, newly released data show economic growth in countries using the euro currency slowed in the second quarter. Eurozone countries' economies cumulatively grew by 0.2% in the second quarter, half of the 0.4% recorded in the first three months of 2019, according to Eurostat, the European statistical agency. Annual inflation in the Eurozone countries fell to 1.1% in July, down from 1.3% in June, Eurostat announced.

Adjusting interest rates is a common practice central banks engage in in order to manage the monetary mass. Rising interest rates generally signal inflation concerns. When rates are high, people are less incentivized to spend money, making the demand for goods and services drop and eventually ease inflation. On the other hand, if interest rates are low, this is a sign of an economy struggling with deflation. Decreased interests will make people more willing to borrow money and make big purchases.

Yet other central banks are staying put. Last week, China announced it will not be looking at lowering their interest rates regardless of the Fed's decision on Wednesday. The leader of the People's Bank of China said China's interest rates are already at an "appropriate' level. Bank of England officials are expected to meet on Thursday and preserve existing interest rates, the Financial Times reported, but likely will reduce economic growth forecasts as the Oct. 31 deadline for the country to leave the European Union approaches.

However, the list of central banks looking at lowering interest rates is growing. Turkey's new central bank governor said on Wednesday that room exists for lowering that bank's interest rate, Reuters reported. And emerging economies such as Vietnam, Brazil, Russia, and South Africa, as well as Australia, South Korea, Chile and, Indonesia are also looking at dropping their rates to boost consumption. Among the moves:

-- Last week, the Central Bank of the Russian Federation cut their interest rate to 25 basis points, to 7.25% per year. Annual inflation should return to 4% in early 2020, the bank said.

-- Also on Wednesday Brazil's central bank is expected to cut its interest rate to a record low.

-- In early July, the State Bank of Vietnam said it would cut several interest rates in order to better manager inflation and boost the economy.

-- Australia is also looking into lowering their rates by the end of the year to a low of 0.75%, after the Australian Bureau of Statistics reported inflation increased by 0.6% in June.

-- Also in July the South African Reserve Bank reduced the repurchase rate by 25 basis points to an annual 6.5%.

-- In June, the Reserve Bank of India cut the policy interest rate by 25 basis points to 5.75% referencing a drop in investment and a "continuing moderation in private consumption growth".

-- In May, Malaysia became the first Southeast Asian country to cut its interest rate this year, lowering it with 25 basis points to 3.0%, also referencing concerns about global economic slowdown.

-- Several other emerging economies have cut their interest rates this year, among which Angola, Kyrgyzstan, Tajikistan, Sri Lanka, Costa Rica, Jamaica, the Philippines, Rwanda, Malawi, Azerbaijan, Ukraine, Kazakhstan, Nigeria, Paraguay, Georgia, and Egypt.

Sintia Radu covers international affairs and technology for U.S. News & World Report. You can follow her on Twitter @sintiaradu and send her suggestions and ideas at sradu@usnews.com.