Federal Reserve 2025: The United States Federal Reserve (Fed) announced a 25 bps interest rate cut to its benchmark rate, pushing the US Dollar down across the FX board. The Summary of Economic Projections (SEP) still shows two more interest rate cuts for 2025, meeting the market’s expectations.
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US Fed Meeting 2025 RealTime Update
US Fed Meeting 2025 LIVE: The US central bank’s Federal Open Market Committee (FOMC), led by Chairman Jerome Powell announced a benchmark interest rate cut at 4%-4.25% today, following its two-day meeting from September 16 to September 17.
The announcement comes amid moderate growth of the economy in the first half of the year. Job gains have slowed, and the unemployment rate has edged up but remains low. Inflation has increased and remains somewhat elevated, Fed noted.
Interest Rate by 25 bps
The Federal Reserve was anticipated to announce the principal interest rates amid a significant decline in United States economic data, particularly within the labour market, thereby increasing forecasts that the central bank will decrease its benchmark interest rate by 25 bps.
After the last FOMC meeting, Fed Chair Jerome Powell announced that the interest rates would remain unchanged at 4.25% to 4.5%. Notably, the Federal Reserve has held the interest rate steady for five consecutive meetings over the past nine months.
The rates have remained steady for some time now despite continued pressure from President Donald Trump, as the Fed adopted a wait-and-watch approach, while anticipating the impact of higher tariffs imposed on trading partners.
FOMC Statement (Press Release)
Recent indicators suggest that growth of economic activity moderated in the first half of the year. Job gains have slowed, and the unemployment rate has edged up but remains low. Inflation has moved up and remains somewhat elevated.
The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook remains elevated. The Committee is attentive to the risks to both sides of its dual mandate and judges that downside risks to employment have risen.
In support of its goals and in light of the shift in the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4 to 4‑1/4 percent. In considering additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks. The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective.
In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals. The Committee’s assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.
Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michael S. Barr; Michelle W. Bowman; Susan M. Collins; Lisa D. Cook; Austan D. Goolsbee; Philip N. Jefferson; Alberto G. Musalem; Jeffrey R. Schmid; and Christopher J. Waller. Voting against this action was Stephen I. Miran, who preferred to lower the target range for the federal funds rate by 1/2 percentage point at this meeting.