Chairman of the Federal Reserve Jerome Powell speaks during a press conference at the Federal Reserve headquarters in Washington, DC on Wednesday. The Fed announced it's cutting interest rates by a quarter percent for the first time since December. Photo by Bonnie Cash/UPI | License Photo
The Federal Reserve on Wednesday cut its target interest rate as it shifts focus from fighting inflation to supporting the choppy labor market.
As financial markets expected, the Fed lowered rates a quarter point to a range of 4% to 4.25%, its first cut since December.
The Fed's decision to begin cutting rates comes as evidence mounts that the U.S. labor market is losing momentum. The headline unemployment rate has stayed steady at near record lows, but the underlying trends are more concerning.
At the same time, the fight against inflation is not over yet. While a cooling jobs market could lead to a recession, cutting rates too much could drive inflation higher.
