Federal Reserve moves toward quarter-point rate cut as data gaps cloud policy view

The US Federal Reserve is widely expected to lower interest rates by 25 basis points this week, responding to mixed economic indicators and employment softness exacerbated by the government shutdown’s data delays. Economists noted diverging inflation signals and weakening job creation, complicating policymaking ahead of the election year. Traders priced in a near-certain cut, with bond yields edging lower across maturities. Officials suggested the Fed remains committed to balancing growth support and inflation control while avoiding excessive monetary easing that could reignite price pressures.