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The Federal Reserve cut interest rates by a quarter percent, bringing the target rate to between four and four and a quarter percent
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Here's what this means for the economy and consumer borrowing. There were a number of factors that played into this decision, including slow job growth, an increase in unemployment, and inflation the committee described as elevated
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While the unemployment rate remains low, it has edged up. Job gains have slowed and downside risks to employment have risen
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At the same time, inflation has risen recently and remains somewhat elevated
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Powell explained how the labor market played a big factor in this decision
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The recent pace of job creation appears to be below the break-even point needed to hold unemployment steady
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According to the St. Louis Federal Reserve Bank, the current break-even job creation rate is between 32,000 to 82,000 jobs per month
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The economy only added 22,000 jobs in August. So what does this all mean for mortgage and loan rates
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Well, this doesn't automatically reduce the cost of borrowing for consumers, but it does reduce the cost of borrowing for banks
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and they typically pass those savings on to their customers. I'm Ray Bogan for Straight Arrow News
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