The U.S. Federal Reserve has decided to cut its key interest rate by 25 basis points, bringing the target range down to 3.75–4.00 percent. The decision was in line with market expectations, as investors had been anticipating continued monetary policy easing for several weeks.
In its post-meeting statement, the Fed emphasised that U.S. economic activity is still expanding, albeit at a moderate pace. Labour market data point to a slowdown in employment growth, and while unemployment remains low, it has risen slightly in recent months. At the same time, inflation — which had previously been easing — has edged up again and remains above the Fed’s 2 percent target.
According to the Fed, the risk of deterioration in labour market conditions has increased, making it necessary to continue adjusting interest rates. The central bank also warned that the macroeconomic environment remains highly uncertain — both in the United States and globally.
Fed leaves future moves open
The Federal Reserve stressed that any further rate cuts will depend on incoming data — particularly inflation dynamics, labour market strength and global sentiment. The Fed reaffirmed its readiness to respond swiftly should new risks emerge to the inflation target or employment stability.
The bank also announced that, as of 1 December, it will end the balance sheet reduction process — the gradual unwinding of bond holdings accumulated during the pandemic. This signals a shift toward a more neutral balance sheet policy stance.
Not a unanimous vote
Today’s decision was adopted by majority vote, but two members of the Federal Open Market Committee dissented. One favoured a deeper cut — by 50 basis points — while the other advocated leaving rates unchanged. This highlights growing divergence within the Fed itself regarding the extent of future monetary easing.
Source: https://ceo.com.pl/fed-ponownie-obniza-stopy-procentowe-47106
