The Federal Reserve cut interest rates by a half-percentage point Wednesday and is projecting another half-percentage point cut over the course of its remaining two meetings this year, signaling a faster pace of monetary stimulus than analysts had been expecting over the summer.

The Fed expects the interbank lending rate to drop to a median level of 4.4 percent by the end of this year, down from 5.1 percent as projected in June.

The central bank is expecting a higher level of unemployment in the economy than it did in June, with the unemployment expectation rising to 4.4 percent through 2024 from 4.0 percent. Unemployment dipped slightly in August to 4.2 percent after bucking upward in July to 4.3 percent.

Inflation projections were accordingly lower, with the Fed dropping the 2024 personal consumption expenditures price index expectation from a 2.6 annual increase to a 2.3 percent increase. Inflation is projected to fall to 2.1 percent next year.

Federal Reserve Chair Jerome Powell pushed back Wednesday against assertions that the Fed’s larger interest rate cuts signaled the bank was behind the curve of the inflation trajectory, given downward revisions to recent employment data.

“We don’t think we’re behind,” he said. “We think this is timely, but I think you can take this as a sign of our commitment not to get behind.”

Analysts expressed surprise Wednesday at the magnitude of the Fed’s rate cut, saying it could........

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