Kathmandu. Big news has come from the United States. The Federal Reserve has decided on its policy rate as expected.
The US Fed has announced a cut in interest rates. This time, the US policy rate has been cut by 25 basis points, or 0.25%. After the latest cut, US interest rates have now fallen to a range of 3.75% to 4%.
Earlier in September, the US Federal Reserve cut rates by the same amount. The Fed said in a statement that this step is taken to stabilize the US economy.
Second consecutive rate cut this year
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This is the second consecutive policy rate cut by the Federal Reserve in 2025. The Fed has lowered the overnight benchmark rate to a target range of 3.75%-4.00%. In September, the Fed cut rates by 25 basis points. It was brought in the range of 4-4.25%. The decision to cut rates at the Fed meeting was made by a 10-2 vote. One member abstained from the rate cut while the other proposed a 50 basis point cut.
Powell is silent on additional rate cuts{
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Fed Chair Jerome Powell hinted at more rate cuts when he announced a rate cut in September. However, after announcing the rate cut, he did not give any indication of any rate cut at the December meeting. He said that there were many different ideas for the December meeting of the committee. It is noteworthy that the next meeting on the policy rate of the US Fed will be held in December.
In a statement after the expected policy rate cut, the Fed’s recent signals indicate that economic activity in the US is gradually picking up. So far in 2025, job growth has slowed. The unemployment rate has gone up. However, its levels are lower than in August. In terms of inflation, it was said to have risen at the beginning of this year and was somewhat high. Therefore, it was decided to cut rates to balance these risks and stabilize the economy.
