Analysis: The Federal Reserve may be forced to make another significant rate cut after the initial 0.5 percentage point reduction
Federal Reserve Chairman Powell has clearly stated that the Fed is not in a hurry to lower interest rates and prefers minor rate cuts. However, this patience will be tested this fall in light of a series of closely watched employment reports set to be released starting this Friday. If there are any new signs of deterioration in the job market, even if policymakers expect to cut rates by 25 basis points each in November and December, the Fed may be forced to make significant rate cuts again after an initial 0.5 percentage point cut. The latest job market data due for release on Friday is expected to reinforce a trend towards mild cooling; economists predict that 146,000 jobs were created last month with unemployment remaining steady at 4.2%. This report roughly aligns with the situation in August when 142,000 jobs were created.
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