Fed's Subtle Shift: Navigating the Rate Change Dilemma

The Federal Reserve has reduced interest rates by a quarter percentage point, acknowledging a softened job market while inflation converges towards its 2% target. Fed Chair Jerome Powell emphasized a balanced approach in rate adjustments, with future decisions hinging on economic data amidst uncertain policy influences from President-elect Trump.

The Federal Reserve announced a quarter-point cut in interest rates, recognizing a softened job market as inflation approaches the 2% target. The decision moves the overnight interest rate to a range of 4.50% to 4.75%.

Fed Chair Jerome Powell expressed confidence in the economy's position, stating that the recalibrated policy stance aims to uphold economic strength and continued inflation progress. Yet, Powell offered limited guidance on potential future cuts, emphasizing reliance on economic data.

Futures markets anticipate another cut in December, with Powell highlighting a cautious approach to balancing inflation control and labor market stability amid potential policy shifts under President-elect Trump.

(With inputs from agencies.)