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Fed Cuts Rates Again to 3.50%–3.75% in Divided Vote, Restarts Short-Term Treasury Buys

Policymakers cite a softening job market, projecting at least one more cut in 2026.

Overview

  • The FOMC lowered the benchmark rate by 25 basis points, marking a third straight quarter-point reduction.
  • The decision drew three dissents, with Austan Goolsbee and Jeffrey Schmid favoring no change and Governor Stephen Miran advocating a larger half-point cut.
  • Officials said the Fed will resume purchases of short-term Treasury securities to ease money-market strains after halting balance-sheet runoff earlier this month.
  • Jerome Powell said policy will remain data dependent, as projections show only a modest path for further easing next year.
  • Stocks rose after the announcement, while President Donald Trump pressed for deeper cuts and is weighing candidates to replace Powell when his chair term ends in May 2026.