Fed Cuts Rates Slightly as Trump Appointee Dissents

The Federal Reserve has cut interest rates for the first time since December, citing signs of a weakening labor market, Howard Schneider and Ann Saphir reported for Reuters.

The Fed's move aligned partly with President Donald Trump’s demands for lower borrowing costs but fell well short of the steep cuts he wanted.

The U.S. central bank lowered its benchmark rate by a quarter point to a 4.00%–4.25% range and signaled more cuts could come at its October and December meetings.

The move aligned partly with President Donald Trump’s demands for lower borrowing costs but fell well short of the steep cuts he wanted.

New Fed Governor Stephen Miran, a Trump appointee, cast the only dissenting vote, after reportedly projecting deeper rate reductions.

“There are no risk-free paths… It’s not incredibly obvious what to do,” Fed Chair Jerome Powell told reporters, stressing the need to balance inflation risks with the Fed’s mandate for maximum employment.

Powell said job growth was running below the level needed to keep unemployment steady, warning that layoffs could quickly worsen the labor outlook.