Federal Reserve cuts key interest rate by 25 basis points to 4.00%-4.25%

The U.S. Federal Reserve announced a 0.25% reduction in its benchmark federal funds rate on Wednesday, lowering it to a target range of 4.00%-4.25%. This decision, which was widely anticipated amid cooling inflation and softening labor market conditions, marks the central bank"s first rate cut since it maintained a rate of 4.25%-4.50% in July.

In his post-meeting remarks, Fed Chair Jerome Powell emphasized rising downside risks to employment, indicating the potential for further easing before the end of 2025. Following the announcement, U.S. stock markets reacted positively, with an increase in stock prices and a weakening of the dollar against major currencies.

For more information on this development, see our recent coverage on the Federal Reserve"s interest rate cuts.