Rate Cut Chaos Returns
Happy Friday — Brian Manning here with your weekly market update.
This week brought a mix of softening job data, another round of questionable communication from the Fed, and some exciting local events on the horizon. Let’s break it down.
Job Market Showing Cracks
On Monday, the Chicago Labor Market Indicator revealed growing weakness in employment. Layoffs are on the rise, and hiring continues to slow.
The Wall Street Journal echoed that sentiment, reporting that several major companies are downsizing by the tens of thousands, while others are holding off on new hires altogether — many citing efficiency improvements and AI adoption as reasons.
Simply put, the job market looks increasingly fragile heading into the end of the year.
Fed Cuts Rates… Then Fumbles the Message
The two-day Federal Reserve meeting wrapped up on Wednesday, as expected, with a quarter-point rate cut. The Fed also announced the end of quantitative tightening, meaning they’re stopping the runoff of their balance sheet — generally a supportive move for markets.
But once again, Jerome Powell’s Q&A session derailed any positive momentum. When asked about the likelihood of another rate cut in December, Powell replied, “It’s not a foregone conclusion — far from it.”
Those nine words sent markets reeling. Mortgage rates, which had started to ease after the initial rate cut announcement, quickly ticked back up. It’s become a familiar pattern this cycle: every time the Fed cuts rates, Powell’s unscripted remarks cause markets to panic.
A Better Way to Answer
Here’s the irony — Powell could have easily provided a measured response. Given that we’re nearly 30 days into a government shutdown, the Fed currently lacks critical data on employment, inflation, and consumer spending. A simple statement like:
“Without current data, it’s difficult to determine what action we’ll take in December.”
…would have sufficed. Instead, his off-the-cuff comment created another wave of uncertainty for both investors and mortgage markets.
Upcoming Realtor Event: Winning with Objections
Realtors — next Wednesday at the St. Julien in Boulder is our final luncheon of the year, featuring the last presentation of Winning with Objections.
Our September event sold out quickly, and this one is nearly full as well. If you want to finish the year strong and sharpen your client communication skills, grab a seat while you still can!
Fall Fiesta: November 13
We’re less than two weeks away from Fall Fiesta, our biggest community event of the year. Join us Thursday, November 13, for live music, McDevitt tacos, an open bar, and a shared goal — raising $10,000 for Community Food Share.
Community Food Share is a Boulder-based nonprofit that delivers food to families facing food insecurity across Boulder and Broomfield counties. Every dollar helps, and every guest makes a difference.
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Brian@BrianManningTeam.com
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