The Financial Times reported on October 14 that Federal Reserve Chair Powell warned at an event hosted by the National Association for Business Economics in Philadelphia that the downside risks to employment in the U.S. labor market are still rising, which is seen as a hint that he may support another 0.25% interest rate cut by the Fed later this month.

Powell also said that even though the current U.S. federal government shutdown has prevented the Bureau of Labor Statistics from obtaining new data, private sector employment indicators and internal Fed research are sufficient to show that the U.S. labor market is cooling down. Powell stated, "Existing evidence" indicates that "layoffs and hiring numbers remain low," and "the public's view on job opportunities and businesses' views on the difficulty of hiring continue to decline." Data shows that the number of layoffs in U.S. companies in September reached 32,000.

This means that despite many economists' concerns that the Trump administration's tariff policies could trigger a new round of inflation in the U.S. economy, Powell is becoming more moderate in his stance on "rate cuts" in monetary policy. The Fed had already lowered its interest rate to 4.00%-4.25% in September.

According to public information, the Fed will hold its meeting on October 28-29. Currently, market investors generally believe the Fed will cut rates by another 25 basis points, or 0.25%, to achieve its goal of promoting market employment and keeping inflation at 2%.

In addition, Powell also said that the Fed may "in the coming months" stop its quantitative tightening operations, allowing assets purchased under its quantitative easing measures during crises to run off, and stated that the Fed "is closely monitoring various indicators to inform this decision."

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