by WorldTribune Staff / 247 Real News December 10, 2025

The Federal Reserve on Wednesday cut its baseline interest rate down to a range of 3.5 to 3.75, a reduction of 0.25 percentage points.

The reduced rate is the lowest it has been in nearly three years. The Fed signaled in a statement that it may keep its rate unchanged in the coming months.

The third consecutive rate cut was approved in a 9-3 vote in the final meeting of 2025 of the Federal Open Market Committee.

Fed board member Stephen Miran wanted to cut rates by 0.5 percentage points, while both Federal Reserve Bank of Chicago President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid didn’t want a cut at all.

Fed Chair Jerome Powell said that while important government data was delayed due to the government shutdown that ended in mid-November after 43 days, available data suggested there has been a moderate expansion of economic activity.

Powell noted that the shutdown likely weighed on activity this quarter, though that will be offset by next quarter. Job gains had slowed significantly through September and inflation for goods has picked up this year due to tariffs, he said.

“Risks to inflation are tilted to the upside and risks to employment to the downside – a challenging situation. There is no risk-free path for policy as we navigate this tension between our employment and inflation goals,” Powell said. He added that the Fed’s framework requires a balanced approach to both goals, which led to the decision to cut for the third straight meeting.

“With today’s decision, we have lowered our policy rate three quarters of a percentage point over our last three meetings. This further normalization of our policy stance should help stabilize the labor market, while allowing inflation to resume its downward trend toward 2% once the effects of tariffs have passed through,” Powell said.

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