The Federal Reserve will begin a rate-cutting path, as soon as Sept. 18. Inflation and the economy remain hot topics in the presidential election.

Federal Reserve Chair Jerome Powell said on Wednesday still strong levels of liquidity in the financial system will allow the central bank to press forward with shrinking its balance sheet even as it has begun cutting rates.

The Fed cut interest rates by half a percentage point yesterday—the first cut in four years and double the 25 basis points that many expected from the central bank. And yet the markets dipped down, perhaps because of a perceived disconnect between Fed Chair Jerome Powell’s sunny prognosis that “the economy is in good shape” and the committee’s bold action that suggests a possible recession on the horizon.