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Fed Delivers Second 25-Basis-Point Cut, Leaves December Easing in Doubt

The Fed set December 1 to halt the runoff of its securities holdings to support market liquidity.

Overview

  • The Federal Open Market Committee lowered the policy range to 3.75%–4.00%, marking a second consecutive reduction this year.
  • Officials cited slower job gains, a slight uptick in unemployment and persistent price pressures, while stressing data dependence for future moves.
  • The vote showed a split, with Stephen I. Miran favoring a 50-basis-point cut and Jeffrey R. Schmid preferring no change.
  • Wall Street finished mixed after the decision, with the Dow and S&P 500 slipping and the Nasdaq rising, as early Asian trading and GIFT Nifty signaled modest, uneven risk sentiment.
  • Market pricing put the probability of another 25-basis-point cut in December near 68%, and analysts said lower U.S. yields could gradually attract foreign inflows into India even as near-term volatility persists.