The Federal Reserve has officially cut interest rates by 0.25 percentage points, bringing it down to between 4% and 4.25%, a level not seen since late 2022. This change, initially suggested amid pressure from President Donald Trump, aims to counteract a weakening job market. Jerome Powell, the Fed Chairman, emphasized the need for policy changes to stimulate growth as meager job gains were reported over the past few months, raising concerns among economists.

Despite the cut, Powell also highlighted potential risks, stating, Unemployment is still low but we're seeing downside risks. Many Fed members supported this decision, although there were differing opinions on how extensive the cuts should be.

The central bank's actions come in response to both domestic economic factors and global trends, with other central banks around the world also lowering rates. Analysts expect further cuts could occur if economic conditions continue to weaken, although Powell insists the broader economy remains stable.

Trump's increasing influence on the Fed and criticism of its previous hesitance to cut rates has raised eyebrows, with calls for even more aggressive actions. This situation underscores not just economic policy dynamics but also the ongoing political intertwining of financial governance in the U.S.