, Columnist
Powell’s Last Rate Cut Would Send Sparks Flying
This may be it.
Photographer: Al Drago/Bloomberg
It’s looking extremely likely that Jerome Powell has overseen his last interest rate reduction as chair of the Federal Reserve. That’s bound to inflame tensions with the White House for the rest of his term, and potentially beyond it.
The Fed cut policy rates by 0.25 percentage point on Wednesday to a range of 3.5% to 3.75%, the third in a series of reductions this year to essentially undo some of the tightening implemented during the worst of the 2022-2024 inflation fight. With the latest move, policy is now within the range of 2.6% to 3.9% that constitutes the estimates of “neutral” from Fed presidents and governors. Powell put it clearly himself: