Overview

• The Federal Open Market Committee lowered the federal funds rate to 4.00%–4.25% and its dot plot implies year‑end rates near 3.5%–3.75%.
• Policymakers cited slowing payroll growth of roughly 29,000 per month, a 4.3% jobless rate, and softer consumer spending, with inflation still near 2.9%.
• New Governor Stephen Miran dissented for a 50‑basis‑point cut and later argued tariffs are not adding material inflation, intensifying scrutiny of Fed independence.
• Minneapolis Fed President Neel Kashkari backed this week’s move and said two more quarter‑point cuts this year will likely be appropriate, while remaining open to pausing or reversing if inflation surprises.
• Markets reacted without fireworks since a 25‑basis‑point move was widely expected, and economists such as Mark Zandi warned the step alone may not prevent a jobs recession.