US Federal Reserve Cuts Interest Rate
(MENAFN) The US Federal Reserve reduced its key federal funds rate by 25 basis points on Wednesday, adjusting the target range to between 3.75% and 4%, as had been broadly anticipated.
This marks the second rate reduction in 2025, following a period in which the central bank maintained the rate steady during its five previous meetings before implementing a cut in September.
According to the Fed, available economic indicators suggest that overall economic activity has been expanding at a moderate pace.
"Job gains have slowed this year, and the unemployment rate has edged up but remained low through August; more recent indicators are consistent with these developments," stated the central bank.
The institution also observed that inflation has increased since earlier in the year and remains "somewhat" elevated.
The Federal Reserve noted that the Federal Open Market Committee (FOMC), which is responsible for setting interest rates, aims to achieve maximum employment while maintaining inflation around 2% over the longer term.
"The Committee is attentive to the risks to both sides of its dual mandate and judges that downside risks to employment rose in recent months," it stressed.
When determining the extent and timing of future adjustments to the policy rate, the FOMC will "carefully" review incoming data, evolving economic projections, and the balance of risks, the Fed said.
Finally, the central bank announced, "The Committee decided to conclude the reduction of its aggregate securities holdings on December 1."
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