Overview
- The Federal Open Market Committee lowered the federal funds target to 3.50%–3.75% with a 25-basis-point cut, marking a third consecutive reduction in 2025.
- Three officials dissented—the most since 2019—with Austan Goolsbee and Jeffrey Schmid preferring no change and Stephen Miran advocating a 50-basis-point cut.
- Fresh projections show the median policymaker expects just one additional quarter-point cut in 2026, alongside a 2026 outlook of about 2.3% GDP growth, 2.4% inflation and 4.4% unemployment.
- Citing gaps from a 43-day government shutdown, the Fed said it relied on “available indicators,” and the backlog of jobs and inflation data due next week could shape the January meeting.
- The committee also authorized purchases of short‑term Treasuries as needed to maintain ample reserves, as policy debates continue with President Trump pushing for deeper cuts and weighing Chair Powell’s successor.