#Fed25bpRateCut

The Federal Reserve has indeed cut interest rates by 25 basis points, lowering the federal funds rate to a range of 4.25%-4.5% ¹. This move was widely expected, with 23-24 basis points of the cut already priced into futures contracts ².

The Fed's decision reflects a more cautious approach to monetary policy, with a focus on managing inflation expectations and supporting economic growth ³. Chairman Jerome Powell emphasized that the Fed will continue to monitor incoming data and adjust policy accordingly, with a focus on achieving maximum employment and price stability ¹.

In terms of future rate cuts, the Fed's projections suggest a slower and shallower path of easing in 2025, with only 50 basis points of cuts expected, down from the previously projected 100 basis points ³. This reflects the Fed's concerns about higher inflation and stronger economic growth.

Overall, the Fed's decision to cut interest rates by 25 basis points reflects a careful balancing act between supporting economic growth and managing inflation expectations.