The highly anticipated August jobs report — seen as a last-minute influence on a September rate cut by the Federal Reserve — came in lighter than expected. The reported 142,000 was 11.8% lower than the median forecast of 161,000, as collected by Dow Jones. The drop in unemployment to 4.2% from 4.3% was as projected.

Since the Federal Reserve's annual Jackson Hole retreat, it's been clear that the central bank would start cutting the benchmark federal funds rate. For years, concerns about inflation and battling it took center stage. The central bank has shifted its attention to the other aspect of its dual mandate, from maintaining stable prices to ensuring full employment. As Powell said, "We do not seek or welcome further cooling in labor market conditions."

How many cuts past September or the size of any continue to be unknown because the Fed is also unlikely to know. It depends on the data that has yet to be compiled and released. "It seems unlikely that the labor market will be a source of elevated inflationary pressures anytime soon," Powell also said.