The disappointing nonfarm payrolls report for August settled any remaining doubts about whether the Federal Reserve will be cutting interest rates this month but left open questions about the intensity. Heading into the release, markets had been pricing in a 100% certainty of a September rate cut, with the only question being whether the Fed would move by a quarter point or half a point. After the Labor Department reported growth of just 144,000 jobs, traders in the fed funds futures market seesawed in the morning. The most recent indication was a strong inkling that the Fed will move more conservatively, with a quarter-percentage-point move. “Our base case remains that the Fed delivers three 25bps cuts between now and year-end, although we acknowledge that risks skew towards a more aggressive path than that,” said Elyse Ausenbaugh, head of investment strategy at J.P. Morgan Wealth Management. One basis point equals 0.01%. “Without a clear signal from the August jobs data, markets will be kept on their toes heading into the September Fed meeting. The Fed gets to make the call between a 25bps or 50bps cut, and either is justifiable,” she added, reflecting the mixed emotions traders had over the Fed’s direction. The Fed’s rate decision is on Sept. 18. September isn’t the only question mark, though. Traders are puzzling over what happens from there, with pricing now indicating a 50-basis-point move in November and possibly another in December, according to the CME Group’s FedWatch Tool . “They’re most likely on for three cuts anyway this year,” said Dan North, senior economist for North America at Allianz Trade. “But I think the case for 50 basis points is maybe a little on the alarmist side.” Two key Fed officials weighed in on Friday morning, indicating a near certainty of a September cut but again not indicating the size. New York Fed President John Williams indicated he is ready to support a cut, while Governor Christopher Waller explicitly endorsed this month’s meeting for a move. He also indicated an openness to larger reductions. “As of today, I believe it is important to start the rate cutting process at our next meeting,” Waller said. “If subsequent data show a significant deterioration in the labor market, the FOMC can act quickly and forcefully to adjust monetary policy.”