It was the rate cut everyone expected, but now what?

From American public media, this is Marketplace.

In Washington, D.C., I'm Kimberly Adams in for Kai Rizdahl.

It's Wednesday, September 17th. Good to have you along.

The Federal Reserve Open Market Committee's announcement today of a quarter point rate cut wasn't a surprise.

And all of the FOMC members, except the newest member of the Fed, Trump-appointee Stephen Myron, were on board

with the modest cut.

Myron won at half a point.

Fed Chair Jerome Powell was clear that this rate cut is an acknowledgement of a shift in attention

from the inflation side of the Fed's dual mandate to the labor market side, because despite

the tariffs... I would just say that the risks there have been less than one might think.

And in terms of the labor market, what we're seeing is unemployment is still low,

it's still a relatively low rate, but we're seeing downside risks.

And what are some of those downside risks?

You see people who are sort of more at the margins. So kids coming out of college and younger

people, minorities are having a hard time finding jobs. The overall job finding rate is very, very low. However, the layoff

rate is also very low. So you've got a low firing, low hiring environment. And the concern is that

if you start to see layoffs, the people who are laid off won't, there won't be a lot of hiring

going on. So that could very quickly flow into, into higher unemployment. Not to mention what's going on with immigration. There's very

little growth, if any, in the supply of workers, and at the same time, demand for workers has also

come down quite sharply, and to the point where we see what I've called a curious balance.

So while Powell says yes, there is still inflation risk from tariffs and other economic

...