Big Take With Inflation Still Sticky, Fed Shifts Focus to the Jobs Market
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Sep 17, 2025 Amara Omeokwe, a Bloomberg Fed and U.S. economy reporter, joins the discussion on the recent Federal Reserve interest rate cut. She delves into the Fed's balancing act amid political pressures and talks about the nuanced state of the labor market. The conversation reveals how inflation and employment data inform the Fed's decisions, alongside the implications for future monetary policy. Listen in as they explore the broader economic context of this quarter-point cut and its potential repercussions.
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Measured Cut Signals Independence
- The Fed's 25 bps cut was expected and signaled caution amid labor-market concerns.
- The move also indicates resistance to overt political pressure on Fed independence.
Labor Market At A Tipping Point
- Fed officials fear the labor market may be at a tipping point that could worsen quickly.
- They balanced that risk against inflation concerns when choosing a modest cut.
Dual Mandate Creates Tension
- The Fed must balance cutting to protect jobs with guarding against persistent inflation.
- Powell explicitly called this a challenging trade-off between upside inflation risks and downside employment risks.