Federal Reserve cuts US interest rates for first time since December
The US Federal Reserve cut interest rates on Wednesday, its first rate cut since December, as the central bank moved to stabilize a wobbling labor market even as Donald Trump’s tariffs continue to push up prices,Rates are now at a range of 4% to 4,25% – the lowest since November 2022,But the decision is unlikely to satisfy Trump, who has lambasted the Fed for acting “too late” and called for a far bigger cut,“Job gains have slowed and the downside risks to unemployment have risen,” Fed chair Jerome Powell said during a closely watched press conference.
At the same time, he warned, inflation has picked up,It is “reasonable” to expect Trump’s tariffs will lead to “a one-time shift” in prices, Powell suggested,“But it is also possible that the inflationary effects could instead be more persistent, and that is a risk to be assessed and managed,” he said,“Our obligation is to ensure that a one-time increase in the price level does not become an ongoing inflation problem,”Last month, Trump moved to fire Fed governor Lisa Cook, claiming she committed mortgage fraud by listing two properties as her primary resident on mortgage applications.
But Cook has denied wrongdoing, and insisted the president has no authority to remove her.A federal judge and an appeals court have blocked Trump from removing Cook from her post, though the White House has appealed to the supreme court.Amid the fiasco, a separate Biden-appointed Fed governor, Adriana Kugler, suddenly resigned from her post in August.Republicans quickly moved to replace her with Stephen Miran, the current chair of the Council of Economic Advisors.The Senate confirmed Miran on Monday.
Miran was the lone dissenting voice on the rates decision.The Fed said he “preferred to lower the target range for the federal funds rate by 1/2 percentage point at this meeting”.The dilemma for the Fed is that lowering interest rates will make borrowing money cheaper, at the risk of potentially causing prices to rise.Powell first hinted that the central bank was leaning toward a rate cut during his speech at the Fed’s Jackson Hole symposium at the end of August.At the time, Powell pointed to uncertainty around immigration and trade policy as significant sources of uncertainty for the economy.
The labor market, Powell said, is experiencing a “curious kind of balance” where the supply and demand for workers have slowed.He warned of “downside risks” to the jobs market that could see higher layoffs and unemployment.Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionSuch risks seemed to materialize when federal jobs data for May and June showed the number of jobs added to the economy was revised down by 258,000.Though the labor market picked up slightly in August, the unemployment rate rose to 4.3%, the highest since 2021.
At the same time, Trump’s tariffs have caused a slow but steady increase in prices.Inflation in August climbed to 2.9% after dipping down to 2.3% in April.The Yale Budget Lab estimates that tariffs will cost households an average of $2,300.
What remains unclear to economists is the nature of these tariff-related price increases: will they amount to a one-time price increase, as companies pass on tariff costs to consumers, or will the impact on inflation be more permanent?The biggest concern for economists is the possibility that unemployment and prices continue to rise, which could lead to what economists call “stagflation”.For now, Fed officials believe that the labor market is a bigger concern, though prices are still likely to increase at higher rates.The director of the nonpartisan Congressional Budget Office told CNBC on Tuesday that tariffs have already made prices increase at a faster pace than was initially anticipated.
Geelong gave my grandfather more disappointment than fulfilment. For me it is the opposite | Dean Sherr
My grandfather was a stoic man. Settling in the western Victorian town of Ballarat upon arrival as a child from a small town in Ukraine, he took up interest in the nearest VFL club, Geelong. Thus began a lifelong affinity with the Cats he would pass down to his four sons and eight grandchildren.Battle-hardened by a modest upbringing, the loss of his mother at an early age and the mental scars of his service in Kokoda, football became a comforting escape from everyday life. Too frail to get to games himself, his lounge room and pay TV were always open to watch games, where most weekends, I would join him
World Athletics Championships 2025: Nader pips Wightman to 1500m world gold after Kerr injury – as it happened
Jake Wightman was leading for most of the end but Isaac Nader, of Portugal, saw the gap and pushed himself on the line from the outside. Reynold Cheruiyot wins the bronze.Neil Gourley finishes tenth and Josh Kerr ends the race last.Here’s a report on that stunning men’s 1500m final.And our report on Katie Moon’s third pole vault crown …That wraps up today’s action, but tomorrow there’s Sydney McLaughlin in the women’s 400m hurdles final, the men’s javelin medals will be decided … and Keely Hodgkinson returns to the global stage, as she begins her hunt for a first world championship gold in the women’s 800m
USA’s Katie Moon rises again to claim third successive world pole vault gold
USA’s Katie Moon leapt to gold in Tokyo on Wednesday in a thrilling final to become the first woman to win three successive pole vault titles at the World Athletics Championships.Moon has fond memories of Japan – she won gold at the Tokyo Olympics in 2021. This time she edged out compatriot Sandi Morris with a final successful leap at a season’s best 4.90m.Morris, a silver medalist at the 2016 Olympics in Rio, placed second on 4
Super League faces 11th-hour challenge to ‘press pause button’ on expansion
Super League’s proposed expansion to 14 teams is at risk of an 11th-hour challenge from clubs amid fears it could jeopardise the future of rugby league as a professional sport.Hull KR and Hull FC voted against expansion at Headingley in July, but other clubs are now understood to have expressed doubts about the Rugby Football League’s plans and want to “press the pause button” until 2027.The concerns centre on the financial sustainability of a 14-team Super League and the RFL’s failure to share a detailed business plan with the clubs. The Guardian has learned that while the RFL leadership gave a presentation at an informal owners’ meeting before the vote in July, multiple requests from several clubs for a detailed financial analysis underpinning expansion have gone unanswered.No documents were provided at the formal shareholders’ meeting where the vote took place, and the minutes of that meeting have not been shared
‘I’m chilling’: Gout Gout passes first test as he qualifies for world 200m semi-finals
Few sporting debuts have arrived with as much hype, but Australian sprint sensation Gout Gout passed his first test at a major global meet by booking a place in the semi-finals of the World Championships in Tokyo.The 17-year-old handled the pressure under the bright lights of Japan’s National Stadium, powering home in a time of 20.23 seconds to grab the third qualifying place in the fifth of six heats.He finished behind Jamaica’s Bryan Levell and Zimbabwe’s Makanakaishe Charamba, the only two athletes in the heat higher than his world ranking of 16.Gout started slowly and was quickly caught by Levell on his inside, but found his stride and comfortably claimed third in a time two-tenths off his personal best of 20
Grand Slam Track denies Michael Johnson earned $2m from scrapped series
Michael Johnson’s Grand Slam Track organisation has denied the former American sprinter has pocketed $2m from the series while athletes have gone unpaid, calling the speculation “categorically false” – and claimed he was facing financial losses himself.Johnson is facing the prospect of legal action from athletes, agents and the suppliers who helped to stage three GST meetings, with sources claiming they are owed as much as $19m (£13.9m). It is understood that two athletes claim they had to withdraw from buying a house when prize money was not paid, and many privately believe they will never receive their money.However a representative for the four-time Olympic champion has told the Guardian that, contrary to the speculation he had been paid $2m (£1
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