UOB(US:UOVEY) Xin Hua Cai Jing·2025-10-30 05:22Core Points - The Federal Reserve decided to lower the federal funds rate target range by 25 basis points to 3.75%-4.00% during its meeting on October 28-29, marking the second rate cut in 2025 following September's decision [1] - The Fed announced it will stop monthly reductions of its balance sheet starting December 1, effectively ending the quantitative tightening process that began in 2022 [1] - UOB's macro research report indicates a possibility of another 25 basis point rate cut in December, with two additional cuts expected in 2026 [1] Summary by Sections Federal Reserve Decision - The rate cut decision was not unanimous, with a vote of 10 to 2, indicating differing opinions among Fed officials [1] - Fed Governor Miran opposed the decision, advocating for a 50 basis point cut, while Kansas City Fed President Schmid preferred to keep rates unchanged [1] Economic Context - Fed Chair Powell described the October rate cut as a "risk management measure" aimed at aligning policy closer to a neutral stance [2] - Powell acknowledged the limitations in obtaining key economic data due to the ongoing government shutdown, suggesting a cautious approach for the December decision [2] Market Expectations - Despite Powell's cautious remarks, market expectations for a December rate cut decreased from "almost certain" to 67.1%, yet UOB maintains its forecast for a 25 basis point cut [2] - UOB predicts that by the end of 2025, the upper limit of the federal funds rate target range will reach 3.75%, with two additional cuts anticipated in 2026, bringing the terminal rate to 3.25% [2] Upcoming Meetings - The next FOMC meeting is scheduled for December 9-10 [3]