Fed Cuts Rates Second Time in Six Weeks

The Federal Reserve cut its benchmark rate by a quarter point, marking the second reduction in roughly six weeks, as policymakers seek to steady growth amid a cooling labor market while inflation remains above the Fed’s 2% target. The move comes amid sizable corporate layoffs — including at Amazon and Target — and roughly 100,000 federal payroll reductions, and decision-making has been complicated by a government shutdown that has frozen much of the economic data the Fed relies on. Borrowers with variable-rate debt — including credit cards, new loans and some adjustable mortgages — should see some relief, while fixed-rate borrowers would need to refinance to capture savings. Savers likely face lower CD and high-yield savings rates as banks and credit unions typically trim yields after Fed cuts, though there may be a brief window before many institutions reset rates. Falling policy and Treasury yields could help housing and small- and mid-cap stocks, but the Fed must balance support for jobs against the risk of sustained inflation and growing political pressure on its independence.