The Fed at a crossroads

The Fed at a crossroads

The Fed at a crossroads The U.S. Fed cut interest rates for the first time since December, lowering the benchmark to 4–4.25%. Markets are betting on more cuts ahead, but the picture is complicated: Key takeaways:

1. Job growth has slowed sharply, averaging just 27,000 new roles per month since May
2. Consumer spending and services remain strong, with markets buoyant
3. Inflation is ticking higher, now at 2.6%, partly due to tariffs

The Fed faces a delicate balancing act — easing enough to support the labor market without reigniting inflation or overstimulating financial markets. One rate cut may serve as insurance. But going further could risk a costly course correction later. Source: https://www.economist.com/leaders/2025/09/17/americas-monetary-policy-risks-getting-too-loose