WASHINGTON ‒ With consumers focused on affordability heading into the holiday season, Federal Reserve Chair Jerome Powell said he hears Americans’ concerns over high costs “loud and clear.”
Still, it was a divided Federal Open Market Committee that on Dec. 10 ordered another quarter-point cut to its benchmark federal funds rate to a range of 3.5% to 3.75%. It’s a move aimed at preventing further cooling in the labor market. However, lower borrowing costs could encourage more spending, raising demand, and, potentially, prices.
“Affordability” has become the watchword of the moment, shaping political campaigns and serving as the centerpiece of President Donald Trump’s cross-country tour he kicked off Dec. 9. Persistent fears about affordability shape day-to-day decisions for many, research suggests. A poll from the progressive think tank the Century Foundation, shared exclusively with USA TODAY, found some Americans are skipping medical care and meals, as well as dipping into savings to cover essentials.
Powell, speaking during a news conference after the central bank's two-day meeting, said consumers are facing “really high” costs and said the Fed is “working hard” to make Americans’ lives more affordable.
