STORY: The Federal Reserve cut interest rates by a larger-than-usual half percentage point on Wednesday.

Fed Chair Jerome Powell said it was aimed at boosting a cooling job market while continuing to push down on inflation.

"This decision reflects our growing confidence that, with an appropriate recalibration of our policy stance, strength in the labor market can be maintained in a context of moderate growth and inflation, moving sustainably down to 2 percent."

[What does a Fed rate cut mean for Americans?]

But what will the first rate cut in four-and-a-half years mean for everyday consumers?

The central bank said it doesn't see the policy rate returning to the sub-2% levels that prevailed for more than a decade before 2022.

That means that era's low mortgage rates, often under 4%, aren't coming back any time soon.

But the rate cut could start to ease some financial pressures.

A lower policy rate should translate to cheaper borrowing costs for most kinds of loans while, on average, paychecks are now rising faster than prices, as inflation has cooled substantially.

Even so, each trip to the grocery store is a reminder that today's dollars don't go as far they did just a few years ago.

[Still on track for a soft landing?]

While the rate cut comes as hiring and wage growth have slowed, Powell says he thinks the economy remains on solid footing.

“I don't see anything in the economy right now that suggests that the likelihood of a recession, sorry, of a downturn is elevated. Okay? I don't see that. You see you see growth at a solid rate, you see inflation coming down, and you see a labor market that's still at very solid levels.”

Policymakers see the Fed's benchmark interest rate falling by another half of a percentage point by the end of this year and another full percentage point in 2025 which would bring it down to 3.25-3.5%

The next Fed policy meeting takes place in November.