Core Points - The Federal Open Market Committee (FOMC) lowered the federal funds rate by a quarter point, bringing it to a range of 4% to 4.25% [1] - The FOMC's dot-plot indicates expectations for future rate trends, with members anticipating two more cuts in 2025 and one in 2026, differing from market expectations [6] - Fed Chair Jerome Powell described the rate cut as a "risk management cut" to hedge against potential economic slowdown [5][7] Economic Context - The Fed is facing challenges with its dual mandate of stable prices and maximum employment, as unemployment has increased and inflation is rising above the 2% target [4] - The impact of President Trump's tariffs on inflation remains uncertain, complicating the Fed's decision-making process [4] Market Reactions - Following the FOMC meeting, the stock market experienced volatility, with questions about whether the S&P 500 index will reach 7,000 or if it is a "sell-the-news" event [2] - The stock market has been anticipating interest rate cuts, which have contributed to the rise in the S&P 500 index [7]