• The Federal Reserve cut interest rates by 50 basis points on Wednesday.

• It's the first interest-rate cut in over four years.

• It is the aggressive move markets expected and signals a focus on boosting a cooling job market.

An interest-rate cut has arrived — and it's a big one.

On Wednesday, the Federal Open Market Committee announced it would be cutting interest rates by 50 basis points. It's the first time the Federal Reserve has cut rates since March 2020.

This puts an end to the central bank's aggressive pandemic inflation fighting and confirms Fed Chair Jerome Powell's remarks at his address in Jackson Hole, Wyoming, last month, during which he said that "the time has come for policy to adjust": The economy was continuing to inch toward the Fed's 2% inflation target, and it would soon be appropriate to ease off the restrictive monetary policy.

The consumer price index, which measures inflation, rose 2.5% year over year in August, coming in below July's 2.9% reading. The unemployment rate also ticked down in August, giving the Fed the data it needed to cut rates.

According to CME FedWatch, which estimates interest-rate changes based on market predictions, a rate cut was all but certain; the question was how big of a cut the Fed would implement. Markets were expecting a 50-basis-point cut, per the predictions, and Wednesday's announcement was in line with expectations.

Additionally, some economists and Democratic lawmakers had for months been calling for a rate cut of at least 50 basis points. Skanda Amarnath, the executive director of the advocacy group Employ America and a former Fed economist, told reporters at a Monday briefing that "it's better to act early."

"It's better to move faster before the data is screaming that we're in a recession because, by that time, 50 basis points may be just not enough," he said.

Democratic Sens. Elizabeth Warren, John Hickenlooper, and Sheldon Whitehouse wanted Powell to go even further, urging him in a Monday letter to cut interest rates by 75 basis points.

"If the Fed is too cautious in cutting rates, it would needlessly risk our economy heading towards a recession," they wrote.

While Powell faced criticism from some experts and lawmakers for waiting to cut rates, he said multiple times that it was better for the Fed to hold off until it received all the data it needed rather than cut rates too early and have to hike them again later.

It's unclear how aggressively the Fed will cut in the coming months, but it'll take time for Americans to feel the relief's impact. There will likely be lags in the housing and car industries, as a single rate cut won't have a material impact in the short term. The same goes with credit cards — interest rates on credit cards have been at historic highs, and it'll take a while for those with balances to see relief.