The U.S. central bank cut interest rates this past week in response to weakening labor market conditions, Federal Reserve Chair Jerome Powell confirmed.
Following the Sept. 16-17 meeting, the Federal Open Market Committee (FOMC) lowered the benchmark policy rate by a quarter point to a new target range of 4.00 percent to 4.25 percent—the first reduction of the year.
Appearing before business leaders in Providence, Rhode Island, on Sept. 23, Powell stated that deteriorating employment conditions are outweighing worries about stubborn inflationary pressures.
Echoing the sentiment of Fed Vice Chair for Supervision Michelle Bowman, he noted that the labor market is “less dynamic” and “somewhat softer,” creating conditions whereby “downside risks to employment have risen.”…