In recent months, inflation has picked up while hiring has slowed.
The Federal Reserve cut its benchmark interest rate a quarter of a percentage point on Wednesday, opting for its second interest rate cut this year in an effort to jumpstart the flagging labor market.
The widely expected move delivers a lowering of interest rates sought by President Donald Trump, though the size of the cut falls short of the major drawdown called for repeatedly by the president.
The Fed previously projected an additional quarter-point cut at its next meeting in December, but Fed Chair Jerome Powell on Wednesday voiced uncertainty about the outlook for another reduction of interest rates.
„A further reduction of the policy rate in December is not a foregone conclusion — in fact, far from it“, Powell told reporters at a press conference in Washington, D.C.
The Dow Jones Industrial Average, S & P 500 and tech-heavy Nasdaq ticked down slightly after Powell cast doubt on the likelihood of a further rate cut.
The policy marked the first interest rate adjustment since the outset of a weekslong government shutdown that threatens to cool economic activity, all the while sharply restricting the release of gold-standard federal data prized by Fed policymakers.
Speaking on Wednesday, Powell acknowledged economic damage wrought by the government shutdown but downplayed its enduring impact.
„The shutdown of the federal government will weigh on economic activity while it persists, but these effects should reverse when the shutdown ends“, Powell said.
