Catenaa, Wednesday, September 17, 2025- The Federal Reserve lowered its benchmark federal funds rate by 25 basis points Wednesday to a range of 4% to 4.25%.
It also signaled two additional quarter-point cuts could occur before the end of the year.
The Federal Reserve cited slowing economic growth, weaker job gains, and elevated inflation for the reason for the cuts
The Federal Open Market Committee also approved the move in an 11-1 vote, with Stephen Miran dissenting in favor of a larger 50-basis-point reduction amid pressure from President Donald Trump, who has repeatedly urged more aggressive easing and suggested removing Fed Chair Jerome Powell if the central bank does not act.1
Powell emphasized that higher tariffs imposed by the Trump administration have begun to push up some prices, but overall impacts remain uncertain, and declining immigration, rather than trade policy, is the primary driver behind the slower labor market.
He stressed that a single quarter-point cut would have a limited effect on the housing market, where supply shortages continue to constrain affordability, and reaffirmed the Fed’s independence despite scrutiny of political appointees.
Financial markets reacted with muted volatility, with bitcoin near $116,000 and ether rising slightly to about $4,491.
Analysts said lower rates could boost liquidity and trading volumes in cryptocurrencies, particularly payments-focused stablecoins, while caution from the Fed might strengthen the dollar and keep markets choppy.
The Fed’s upcoming conference on stablecoin business models and tokenized financial services has prompted institutions to reassess exposures to digital assets.
Policy makers emphasized their commitment to maximum employment and returning inflation to 2% over the longer run, while ongoing reductions in Treasury and mortgage-backed securities continue.
- https://www.federalreserve.gov/newsevents/pressreleases/monetary20250917a.htm[↩]
