The Federal Reserve announces long-awaited rate cut
News | By Easton Martin | September 17, 2025
The Federal Reserve announced today its first interest rate cut of 2025, reducing the benchmark rate by 0.25 percentage points to a range of 4.00% to 4.25%. This move is intended to stimulate economic activity amid a weakening labor market and elevated inflation. The Fed also indicated plans for additional rate cuts later this year, potentially bringing the rate down further by December.
President Donald Trump has repeatedly called for lower interest rates to boost economic growth. Ahead of the Fed’s announcement, he urged the central bank to “cut rates now, and bigger than he had in mind,” expressing frustration with what he sees as a slow pace of monetary easing. Trump has also pressured Fed leadership in other ways, including attempting to remove a sitting governor, though these efforts were blocked.
While the 0.25 percentage point reduction is modest, it aligns with Trump’s push for lower rates, signaling a shift in the Fed’s policy focus. After a period of prioritizing inflation control, the central bank appears increasingly concerned with supporting economic growth and employment. Economists say the move may help ease borrowing costs for businesses and consumers, though it remains to be seen whether further cuts will follow.
