Friday’s August jobs report has huge implications for 401(K)s and homebuyers

The Federal Reserve is expected to cut interest rates at its September meeting, and this latest report doesn’t change that.

Investors will now be wondering how much the Fed will cut rates.

The central bank has kept benchmark interest rates at their highest level in 23 years, between 5.25 percent and 5.5 percent, for more than a year.

Markets are weighing whether Chairman Jerome Powell and Fed officials will cut interest rates by a quarter of a percentage point this month or make a larger reduction of half a point.

Stock futures fell on Friday as investors reacted to weaker-than-expected job growth in August.

The S&P 500 fell 0.6 percent, the Dow Jones Industrial Average fell 0.4 percent and the Nasdaq fell 1 percent immediately after the report was released.

While the unemployment rate met expectations, job growth was slower than economists had anticipated.

In July, a weak report triggered a market sell-off amid fears that the US economy was heading for a recession.

The unemployment rate fell to 4.2 percent in August, down from 4.3 percent the previous month.

The U.S. economy added 142,000 jobs in August, below the forecast of 161,000.

This reflects a slower labor market, which should clear the way for a rate cut by the Federal Reserve later this month.