Federal Reserve Cuts Rates in December: What It Means for Inflation, Growth, and Markets
In December, a significant policy step was taken by US Federal Reserve on cutting interest rates by 25 basis points (0.25%) during its December 9–10 FOMC meeting. In this action, the federal funds rate was brought down to a range of 3.50%–3.75%. This decision by Fed marked the third consecutive rate cut in 2025, signaling that the Fed is gradually shifting its stance from aggressive tightening to cautious easing. Investors had already assumed this outcome, while this decision carries deeper implications for financial markets, economic growth, inflation, and global economies.