The Federal Reserve on Wednesday cut interest rates for the first time in 2025 and released policymakers' quarterly forecast of economic conditions that shows the potential outlook for further rate cuts, as well as inflation and the labor market. The 25-basis-point cut lowered the benchmark federal funds rate to a new range of 4% to 4.25%, after rates were held steady at the first five meetings of this year amid economic uncertainty regarding the labor market and inflation amid tariff shifts and immigration ...

The Federal Reserve is back in focus as today’s Federal Open Market Committee (FOMC) meeting could bring the first rate cut of 2025, and traders are closely watching what it could mean for the Bitcoin price. Markets are heavily leaning toward a rate cut at this week’s Federal Open Market Committee (FOMC) meeting. Data from CME’s FedWatch tool shows a 96% probability that the Fed will reduce its benchmark rate by 25 basis points. There is also a small, 4% chance that policymakers could move more aggressi ...

The US Federal Reserve delivered a widely expected 25 basis point rate cut yesterday and signaled two further reductions before the end of the year. It comes amid concerns surrounding the weakness of the US labor market and was characterized by chair Jerome Powell in his post decision press conference as risk management. The committee voted 11 to1 who's the one 11 to1 to lower rates by 25 basis points with less descent than expected.Yeah, Waller and Bowman were in line with what the Fed chair voted. The Tru ...

Group 1 - The Federal Reserve has lowered the federal funds target rate by 25 basis points to a range of 4.00%–4.25%, marking the first rate cut of the year [1] - The easing of the dollar is expected to stimulate economic activity in Hong Kong, benefiting asset performance [1] - Lower interest rates are anticipated to reduce corporate financing costs and encourage capital expenditure [1] Group 2 - The recent data indicates that the "stagflation" effect from tariffs on the U.S. economy is becoming apparent, with a more pronounced downward trend in employment compared to rising inflation [1] - The Fed's statement has notably shifted regarding the labor market, emphasizing rising unemployment risks and changes in risk balance, reflecting a greater focus on employment issues [1] - The dot plot has significantly shifted downward, with median rate forecasts for the end of this year and next year both lowered by 25 basis points, indicating a dovish policy stance [2] Group 3 - There are still divisions among Fed members regarding the extent of rate cuts, as some members advocate for a 50 basis point cut instead of 25 [2] - The uncertain economic outlook and frequent expressions from the U.S. government regarding monetary policy preferences may weaken the predictability of future monetary policy [2]

Core Viewpoint - The Federal Reserve's recent interest rate cut of 25 basis points reflects growing concerns about slowing labor markets, despite persistent inflation pressures [2][5][6]. Rate Cuts and Economic Indicators - The Federal Reserve has cut interest rates four times since 2024, with the latest adjustment bringing the federal funds target range to 4.00%–4.25% [2][3]. - The unemployment rate rose to 4.3% in August, the highest level since late 2021, indicating a slowdown in job creation [5]. - Fed Chair Jerome Powell described the rate cut as a "risk-management cut," highlighting simultaneous cooling in both labor supply and demand [6]. Fed's Projections and Policy Outlook - The updated "dot plot" projections show a divided outlook among policymakers, with ten officials expecting two more rate cuts this year and nine anticipating only one [8]. - The Fed's longer-run neutral rate median remains at 3%, with some policymakers advocating for an even lower rate, reflecting uncertainty about the necessary policy tightening to manage inflation without hindering growth [9]. Market Reactions - Following the rate decision, the Dow Jones Industrial Average increased by 260 points (0.6%), while the S&P 500 and Nasdaq Composite experienced slight declines [12]. - Rate-sensitive sectors, including blue-chip companies like Walmart and JPMorgan, saw gains, while high-flying tech stocks faced profit-taking [13]. Political Context - The rate cut decision occurred amid political pressure, with President Trump advocating for more aggressive rate cuts to support housing and manage government debt [11].

Core Insights - The article discusses the potential impact of recent interest rate cuts by the Federal Reserve on the US housing market, highlighting that while mortgage rates have decreased, significant changes in borrowing costs may not be forthcoming [4][8][9] Mortgage Rates and Housing Market - The average rate on a 30-year mortgage fell to 6.35%, marking the largest weekly decline in a year and the lowest in 11 months [4] - Despite the Federal Reserve's interest rate cut, mortgage rates may not decrease significantly further as banks had already adjusted rates in anticipation of this cut [5][8] - Approximately 80% of mortgage borrowers have locked in rates below the current average, which contributes to a reluctance among homeowners to sell and thus limits housing supply [13][12] Buyer Sentiment and Market Activity - Some prospective buyers, like Aileen Barrameda, are motivated to enter the market despite high mortgage rates, anticipating future price increases [3][11] - Real estate agents report increased activity, with some buyers encouraged by recent declines in mortgage rates, although the overall market remains unaffordable for many [10][11] - Cautious optimism exists among lenders regarding the housing market, but the recent dip in mortgage rates is not expected to resolve underlying affordability issues [18][19]

Group 1: Federal Reserve Rate Cut - The U.S. Federal Reserve cut its benchmark interest rate by 25 basis points, lowering the federal funds rate to a range of 4.00% to 4.25%, marking its first reduction in nine months [1] - The decision was supported by 11 of 12 voting members and was influenced by weaker labor market data, slower consumer spending, and an increase in unemployment [1][2] - Prediction markets indicated a 93% probability of the rate cut prior to the announcement, suggesting that markets had fully anticipated this move [1] Group 2: Economic Indicators - Fed Chair Jerome Powell noted that inflation has risen and remains elevated, with GDP growth slowing due to reduced consumer spending [3] - Job gains are reportedly below the breakeven rate, with payroll growth at approximately 29,000 per month and unemployment rising to 4.3% [3] - Powell expressed uncertainty regarding the impact of tariffs on inflation, indicating that new trade restrictions could complicate the Fed's efforts to reach its 2% inflation target [3] Group 3: Market Reactions - Following the rate cut announcement, crypto-adjacent equities experienced mixed trading, with Coinbase down 2.20% and MicroStrategy down 0.86%, while PayPal rose 1.62% [4] - Mining stocks also weakened, with Marathon Digital down 1.02% and Iris Energy down 0.44%, while Galaxy Digital gained 1.89% [5] - Major cryptocurrencies like Bitcoin and XRP showed little momentum post-announcement, with Bitcoin trading flat below $116,000 and XRP at $3.02, reflecting that the market had already priced in the rate cut [6][7] Group 4: Analyst Insights - Analysts suggest that the Fed's rate cut provides support for cryptocurrencies but does not represent a fundamental market shift, describing it as a tailwind rather than a paradigm shift [7] - A lower discount rate is expected to lift the multiples on growth-sensitive assets like Bitcoin and Ethereum, while reducing the opportunity cost of holding these assets compared to cash [7]

Summary of Key Points Core Viewpoint - The Federal Reserve has initiated a new phase of gradual easing by cutting interest rates by a quarter-point, lowering the target range for the federal funds rate from 4.25%-4.50% to 4.00%-4.25% [1][2]. Economic Projections - Inflation is projected to rise to 3.1%, unchanged from previous estimates, while GDP growth has been upgraded to 1.6% from 1.4% [5]. - The unemployment rate is expected to increase to 4.5%, up from the current rate of 4.3% [7]. Fed's Dual Mandate - Fed Chairman Jerome Powell described the rate cut as a "risk management cut," indicating a shift in focus towards protecting jobs rather than solely combating inflation [2][8]. - The FOMC statement highlighted that downside risks to employment have risen, with 11 out of 12 Fed voters supporting the rate cut [3]. Dot Plot Analysis - The updated dot plot suggests approximately two more quarter-point cuts by the end of the year, but there is significant inconsistency in the forecasts among Fed members [4][10]. - Six members opposed the cut, indicating a hawkish sentiment within the committee [5]. Market Reactions - Following the announcement, market reactions were mixed, with the Dow up about 0.50%, the S&P flat, and the Nasdaq down modestly, reflecting uncertainty among investors [9][10]. - The 10-year Treasury yield rose to 4.076%, and the dollar strengthened by about 0.3% [10]. Future Outlook - The Fed's future actions will depend on incoming economic data, particularly the next CPI and PCE reports, which will be critical for the market's bullish case [10][11]. - There is a belief that if inflation stabilizes or decreases while job losses remain moderate, the Fed may proceed with additional rate cuts as indicated in the dot plot [11][15].

The Federal Reserve has cut interest rates by a quarter percentage point, lowering the upper bound of its federal funds rate to 4.25%. The decision, which brings rates to their lowest level since November 2022, was widely expected by markets after weeks of weakening labor data and softer inflation readings. FOMC Trims Target Range by 25 bps, Citing Softer Jobs and Elevated Risks The move trims the target range from 4.50% to 4.25%, marking the Fed’s first rate cut since earlier this year. Chair Jerome P ...

Stock Market News From Sept. 17, 2025: Dow Gains After Fed Decision Last Updated: CONCLUDED Updated 2 hours ago Stocks Stall After Wall Street Finally Gets Its Rate Cut By Connor Smith The Federal Reserve finally cut interest rates, and Wall Street didn't know what to do with itself. The S&P 500 dipped 0.1%. The Dow Jones Industrial Average rose 260 points, or 0.6%. The Nasdaq Composite fell 0.3%. The major indexes initially spiked after the Federal Open Market Committee said it decided to lower the federal ...