A fire believed to have been started by squatters living in the Grand Central subway station stopped rush-hour service for an hour Wednesday morning and inconvenienced an estimated 125,000 riders. The fire burned rubbish and generated thick smoke in an unused circuit-breaker room in the station in midtown Manhattan, said John Mulligan, a Fire Department spokesman. Two Transit Authority police officers were treated for smoke inhalation, but no other injuries were reported, TA spokesman Bob Previdi said. Investigators who checked the 12-by-30 foot circuit-breaker room found shopping carts and personal belongings of squatters, said Previdi. Operations of the Metro-North commuter railroad, which uses the nearby Grand Central Terminal, were not affected, Previdi said.