Fed Lowers Interest Rates Amid Economic Data Uncertainties
The Federal Reserve has opted to cut its policy interest rate by 25 basis points, moving the target range to 3.75%-4.00%, despite gaps in critical employment and growth data. A Reuters survey shows near-unanimous consensus among economists for this adjustment, framed as a procedural response to the absence of updated economic indicators.
Key labor market statistics remain inaccessible due to the ongoing partial U.S. government shutdown, now in its 29th day. Fed officials are relying on August employment data, which showed unemployment rising to 4.3%. While the labor market appears stable overall, recent layoffs at major corporations and rising state-level unemployment claims warrant caution.
September's Consumer Price Index data revealed slowing housing price growth, easing inflationary pressures. This trend, combined with labor market softness, has solidified market expectations for monetary policy easing.
