\n<\/p>\n
The United States Federal Reserve has cut its benchmark interest rate by 25 basis points to 3.75-4.00 percent, amid signs of a slowing labour market and continued pressure on consumer prices.<\/p>\n
The cut, announced on Wednesday, marks the US central bank\u2019s second rate cut this year.<\/p>\n list of 4 items<\/span>end of list<\/span><\/section>\n \u201cJob gains have slowed this year, and the unemployment rate has edged up but remained low through August; more recent indicators are consistent with these developments. Inflation has moved up since earlier in the year and remains somewhat elevated,\u201d the Fed said in a statement.<\/p>\n \u201cUncertainty about the economic outlook remains elevated.\u201d<\/p>\n The cuts were largely in line with expectations. Earlier on Wednesday, CME FedWatch \u2014 which tracks the likelihood of rate cuts \u2014 said there was a 97.8 percent probability of rate cuts.<\/p>\n After the September cut, economists had largely been expecting two additional rate cuts for the rest of this year. Goldman Sachs, Citigroup, HSBC, and Morgan Stanley, among others, forecast one more 25-basis-point reduction by year\u2019s end following Wednesday\u2019s cut. Bank of America Global Research is the only major firm that is not anticipating another 25-basis-point cut in 2025.<\/p>\n \u201cThe Fed has a challenging line to walk; lower interest rates to support labour markets and growth, or raise them to tamp down inflation. For now, they are taking a cautious approach tilted a bit towards the growth concerns,\u201d Michael Klein, professor of international economic affairs at The Fletcher School at Tufts University in Massachusetts, told Al Jazeera.<\/p>\n Despite forecasts, Federal Reserve Chairman Jerome Powell said another rate cut isn\u2019t necessarily inevitable.<\/p>\n \u201cWe haven\u2019t made a decision about December,\u201d Powell told reporters in a press conference, referring to the next rate decision meeting of the Fed.<\/p>\n \u201cWe remain well-positioned to respond in a timely way to potential economic developments.\u201d<\/p>\n The cuts come as economic data becomes increasingly scarce amid the ongoing government shutdown, now in its 29th day as of Wednesday, making it the second-longest in US history, behind the 35-day shutdown during the first presidency of Donald Trump in late 2018 and early 2019.<\/p>\n Because of the shutdown, the Department of Labor did not release the September jobs report, which was scheduled for October 3. The only major government economic data released this month was the Consumer Price Index (CPI), which tracks the cost of goods and services and is a key measure of inflation. The CPI rose 0.3 percent in September on a month-over-month basis to an inflation rate of 3 percent.<\/p>\n That data was released because the Social Security Administration required it to calculate cost-of-living adjustments for 2026. As a result, Social Security beneficiaries will receive a 2.8 percent increase in payments compared to 2025.<\/p>\n The shutdown, however, could have a bigger impact on next month\u2019s central bank decision as the Labor Department is currently unable to compile the data needed for its November reports.<\/p>\n However, amid the limited government data, private trackers are showing a slowdown.<\/p>\n \u201cWe are not going to be able to have the detailed feel of things, but I think if there were a significant or material change in the economy one way or another, I think we would pick that up,\u201d Powell said.<\/p>\n Consumer confidence fell to a six-month low, according to The Conference Board\u2019s report that was released on Tuesday.<\/p>\n The data showed that lower-income earners \u2013 those making less than $75,000 a year \u2013 are less confident about the economy as fears of job scarcity loom. This comes only days after several large corporations announced waves of layoffs.<\/p>\n On Wednesday, Paramount cut 2,000 people from its workforce. On Tuesday, Amazon cut 14,000 corporate jobs. Last week, big box retailer Target cut 1,800 jobs. This comes as furloughs and layoffs weigh on government workers. The US government is the nation\u2019s largest employer.<\/p>\n Those making more than $200,000 annually remain fairly confident and are leading consumer spending that is keeping the economy afloat, according to The Conference Board.<\/p>\n Pressures both on consumer spending and the labour market are largely driven by tariffs weighing on consumers and businesses.<\/p>\n US markets are lower on the rate cut. The S&P 500 and Dow Jones Industrial Average are both down by about 0.3 percent, and the Nasdaq is about even with the market open as of 3pm in New York (19:00 GMT).<\/p>\n<\/div>\n The United States Federal Reserve has cut its benchmark interest rate by 25 basis points to 3.75-4.00 percent, amid signs of a slowing labour market and continued pressure on consumer prices. The cut, announced on Wednesday, marks the US central bank\u2019s second rate cut this year. Recommended Stories list of 4 itemsend of list \u201cJob […]<\/p>\n","protected":false},"author":1,"featured_media":497,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-496","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-us-canada-news"],"_links":{"self":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts\/496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=496"}],"version-history":[{"count":0,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts\/496\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/media\/497"}],"wp:attachment":[{"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Recommended Stories <\/h2>\n
Government shutdown implications<\/h2>\n
Consumer confidence lags<\/h2>\n
<\/p>\n","protected":false},"excerpt":{"rendered":"