Jerome Powell had big news Wednesday afternoon, with the Federal Reserve chair announcing the first interest rate cut in over four years. The federal funds rate, also known as the base interest rate, was reduced by 50 basis points, down from a two-decade high after the Fed fought the biggest spike in inflation since the early 1980s.
Powell all but declared the battle against inflation won last month in a speech at the Kansas City Fed’s annual symposium in Jackson Hole, Wyoming. “The time has come for policy for adjust,” he said then, amid a rise in the unemployment rate and other signs of a cooling economy.
