Fed Cuts Rates by Stronger Than Normal 50 bps as Powell Emphasizes Timeliness

Sep 18, 2024, 06:47 PM

Federal Reserve Chair Jerome Powell announced a stronger than normal 50 basis points (bps) interest rate cut, emphasizing that the Fed's patient approach over the past year has paid dividends. Powell stated, 'We don't think we're behind. We think this is timely.' He also noted that the central bank will have the opportunity to assess two additional jobs reports before making its next policy decision, allowing for further data-driven adjustments. Powell acknowledged the potential of a weakening labor market and the ongoing battle to reduce inflation to 2%, but maintained that the 50 bps cut is appropriate as current policy has become too restrictive. Powell described the move as a sign of the Fed's commitment not to get behind.