Fed's Powell: policymakers noted 'artificially high' jobs data, revisions in rate cut decision
Barrons senior writer Megan Leonhardt reacts to the U.S. economy adding 818,000 fewer jobs than initially reported on 'Cavuto: Coast to Coast.'
Federal Reserve Chair Jerome Powell said Wednesday that the central bank considered reports that recent jobs numbers may be «artificially high» and are set for downward revisions when policymakers assessed the health of the labor market ahead of their decision to lower interest rates by 50 basis points.
Powell explained during the post-meeting press conference that since the Fed's last meeting at the end of July, policymakers have received two employment reports and inflation reports apiece, as well as the Bureau of Labor Statistics' Quarterly Census of Employment and Wages (QCEW).
«We've had the two employment reports, July and August. We've also had two inflation reports, including one that came in during blackout. We had the QCEW report which suggests… that the payroll report numbers that we're getting may be artificially high and will be revised down,» Powell said.
«So we took all of those and we went into blackout and we thought about what to do, and we concluded that this was the right thing for the economy, for the people that we serve. And that's how we made our decision,» he said of the process that led to the rate cut.
THE FED CUT RATES BY HALF-POINT: WHAT TO KNOW
Federal Reserve Chair Jerome Powell noted that policymakers weighed downward revisions to jobs reports in making their decision to cut interest rates for the first time in four years. (Anna Moneymaker/Getty Images / Getty Images)
The Labor Department released the QCEW last month, which covered the 12-month period from April 2023 to March 2024 and showed a downward revision of 818,000 jobs to payroll figures
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