For the second time this year, the Federal Reserve has issued a rate cut.
The central bank’s policy making Federal Open Market Committee voted to lower the target range for the federal funds rate by a 0.25% to a new range of 3.75% to 4%. All but two of the Committee’s members voted for this reduction, with Stephen Miran – who is on a leave of absence as chairman of the White House’ Council of Economic Advisers – seeking a 0.50% cut and Kansas City Fed President and CEO Jeffrey R. Schmid seeking no change in the rate level.
“Available indicators suggest that economic activity has been expanding at a moderate pace,” said the Fed in a statement. “Job gains have slowed this year, and the unemployment rate has edged up but remained low through August; more recent indicators are consistent with these developments. Inflation has moved up since earlier in the year and remains somewhat elevated.”
The Fed added that “uncertainty about the economic outlook remains elevated,” although it did not mention the lack of current data due to the ongoing federal government shutdown.
