Overview
- The Federal Reserve lowered its policy rate by 25 basis points to 3.75%–4.00%, with Chair Jerome Powell saying a December cut is not a foregone conclusion and citing limited data during the government shutdown.
- The FOMC vote showed division, with Stephen Miran favoring a 50 bp cut and Jeffrey Schmid preferring no change, and the Fed signaled it will end balance‑sheet runoff on December 1.
- The Bank of Japan kept its short‑term rate at 0.5% in a 7–2 decision, as Naoki Tamura and Hajime Takata dissented for a hike to 0.75% and the BOJ reiterated it would tighten only if wage and price trends track projections.
- BOJ projections were largely steady and markets were mixed, with the yen hovering near 152–153 per dollar, Japanese 10‑year yields little changed, and the Nikkei edging higher.
- Political and international pressures intensified, with Prime Minister Sanae Takaichi’s preference for looser policy tempering near‑term hike expectations and U.S. Treasury Secretary Scott Bessent urging sound BOJ communication to curb currency volatility.