Federal Reserve Cuts Rates by a Quarter Point
The Federal Reserve recently reduced the benchmark interest rate by a quarter point in its third cut of 2025.
The reduction takes the federal funds rate, the interest rate banks charge each other for short-term loans, to a target range of 3.5%-3.75%. Three members of the rate-setting Federal Open Market Committee (FOMC) cast dissenting votes. Austan Goolsbee and Jeffrey Schmid favored no change, while Stephen Miran preferred a half-point reduction.
Additionally, Fed officials in a median projection forecast one quarter-point reduction in the federal funds rate for 2026.