Powell Sees 'Challenging Situation' for Fed Amid Dual Threats

Group 1 - Near-term risks to inflation are tilted to the upside while risks to employment are tilted to the downside, indicating a challenging economic situation [1] - The balance of risks has shifted due to increased downside risks to employment, leading to a decision to lower the target range for the federal funds rate by 25 basis points to 4 to 4.25 percent [2] - The current policy stance is considered modestly restrictive, allowing for flexibility in response to economic developments based on incoming data and evolving outlook [3] Group 2 - The commitment remains to support maximum employment and achieve a sustainable inflation rate of 2%, which is crucial for the well-being of all Americans [4]