Washington. The Federal Reserve cut its benchmark interest rate by 25 basis points Wednesday, lowering the federal funds target to 3.50–3.75 percent after a two-day FOMC meeting. Chair Jerome Powell said officials will wait to see and flagged a higher bar for future reductions while projecting one additional cut next year. Fed officials cited a cooling labor market and persistent inflation as reasons for caution. Three policymakers dissented, the most since 2019, with votes split over the pace and size of cuts. Markets and borrowers will monitor incoming data to assess policy direction. Based on 11 articles reviewed and supporting research.
Prepared by Christopher Adams and reviewed by editorial team.
Borrowers and households with variable-rate debts benefited from lower borrowing costs after the Fed reduced its benchmark rate by 25 basis points.
Savers and fixed-income investors faced lower returns as Treasury and deposit yields fell following the Fed's rate reduction.
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Washington Fed Cuts Rates, Signals Pause Ahead Now
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