President Donald Trump has pledged cheaper prices and lower interest rates, but an economy transformed by the pandemic will make those promises difficult to keep.

The Federal Reserve’s third interest rate cut of the year will likely have consequences for debt, savings, auto loans, mortgages and other forms of borrowing by consumers and businesses.

The Federal Reserve faces a cooling job market as well as persistently high prices, Chair Jerome Powell said in testimony to Congress, a shift in emphasis away from the Fed’s single-minded fight against inflation that suggests it's moving closer to cutting interest rates.

The nation’s economy slowed sharply last quarter to a 1.6% annual pace in the face of high interest rates, but consumers — the main driver of economic growth — kept spending at a solid pace.

The Federal Reserve is getting some unwanted help in its drive to slow the U.S. economy and defeat the worst bout of inflation in four decades: a cutback in bank lending.

After reaching 40-year highs over the summer, price increases in the U.S. are now steadily easing.

Friday’s report from the Commerce Department also showed that income, which provides the fuel for spending, rose 0.9% in September. The September report showed that consumer spending on durable goods such as autos shot up 3% in September. Spending on nondurable goods, like food and clothing, rose by a smaller 1.5%. The third quarter rebound was led by a record 40.7% increase in consumer spending in the third quarter. The spending and income report showed that inflation, as measured by the Federal Reserve's preferred gauge, was 0.2% in September and 1.4% over the past 12 months.

The number of laid-off workers seeking unemployment benefits barely fell last week to 1.5 million, the government said Thursday. The report is “telling us that the scars from the job losses in the recession will be longer-lasting than we expected,” said Gregory Daco, chief U.S. economist at Oxford Economics. In May, for example, employers added 2.5 million jobs — an increase that caught analysts off-guard because the number of applications for unemployment aid was still so high. Some likely factors help explain why applications for jobless benefits remain so high even as businesses increasingly reopen and rehire some laid-off workers. “We’re starting to see more job losses among higher-skilled positions that are harder to recall," said Brad Hershbein, a senior economist at the Upjohn Institute.