Federal Reserve cuts interest rates by 0.25%
Updated 9/18/2025 8:51:00 AM
Arab Finance: The US Federal Reserve announced a 25-basis-point cut at a range between 4% and 4.25%, according to a statement issued by the Federal Open Market Committee (FOMC).
Recent indicators highlighted that growth of economic activity moderated in the first half (H1) of 2025. With hiring gains have softening and the unemployment rate going up.
The statements also indicted a rise in inflation rate, however, it remains somewhat elevated.
“Uncertainty about the economic outlook remains elevated,” the Fed said. “The Committee is attentive to the risks to both sides of its dual mandate and judges that downside risks to employment have risen.”
"We fully understand and appreciate that we need to remain fully committed to restoring 2% inflation on a sustained basis. And we will do that. At the same time, we've got to weigh the risk to the two goals," Fed Chair Jerome Powell commented.
He claims the risks of higher and more persistent inflation have softened because the labor market is weakening and gross domestic product (GDP) has slowed.
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