"WASHINGTON (AP) - The Federal Reserve cut its key interest rate by a quarter-point Wednesday and projected it would do so twice more this year as concern grows at the central bank about the health of the nation's labor market."
"Fed officials, led by Chair Jerome Powell, had kept their rate unchanged this year as they evaluated the impact of tariffs, tighter immigration enforcement, and other Trump administration policies on inflation and the economy."
"Yet the central bank's focus has shifted quickly from inflation, which remains modestly above its 2% target, to jobs, as hiring has grounded nearly to a halt in recent months and the unemployment rate has ticked higher."
"Many economists forecast additional dissents, and the outcome suggests that Powell was able to patch together a show of unity from a committee that includes Miran and two other Trump appointees from his first term, as well as a Fed governor, Lisa Cook, whom Trump is seeking to fire."
The Federal Reserve cut its key interest rate by a quarter-point to about 4.1%, down from 4.3%, marking its first cut since December. Fed officials signaled two additional cuts this year and one in 2026, a projection that may disappoint Wall Street after investors had expected more. The Fed shifted focus from inflation—still modestly above the 2% target—to concerns about the labor market as hiring slowed and unemployment ticked higher. Lower rates are intended to reduce borrowing costs for mortgages, cars, and businesses and to support growth and hiring. One policymaker, Stephen Miran, dissented from the decision.
Read at Boston.com
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