Future

Reserve

<ul class="wp-block-list">
 <li>The Fed cut interest rates by 0.25%, signaling a slower pace of cuts amid economic uncertainty.</li>  
 <li>Despite rate cuts, inflation remains above target, with the Fed revising its 2025 inflation forecast to 2.5%.</li>  
 <li>The job market stays strong, but the Fed expects a slight rise in unemployment in 2025 and 2026.</li> 
</ul>  
<p>The Federal Reserve <a href="https://www.federalreserve.gov/newsevents/pressreleases/monetary20241218a.htm" rel="noopener noreferrer nofollow">cut</a> its key interest rate by 0.25%. The new rate range is between 4.25% and 4.5%. Economists anticipated this range of rate cuts. The central bank has signaled a slower pace of rate cuts going forward. Policymakers are aiming to balance economic growth and inflation control.</p>  
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<h2 class="wp-block-heading" id="h-economic-conditions-and-inflation"><strong>Economic Conditions and Inflation</strong></h2>  
<p>New economic indicators show that US economic activity remains strong. Inflation remains higher above the Federal Reserve's long-term target of 2%. In October, the Personal Consumption Expenditure Index <a href="https://cryptonewsland.com/u-s-fed-eases-monetary-policy-with-25-point-rate-cut/" rel="noopener noreferrer nofollow">increased</a> to 2.3%. This marked the first monthly increase following three months of drops. In November, the Consumer Price Index increased slightly due to rising food costs.</p>  
<p>Despite these problems, the Fed remains optimistic that inflation will be brought under control. Additionally, it projects 2.5% inflation in 2025 as opposed to its earlier forecast of 2.1%. The job market is still strong, and unemployment is still low. The unemployment rate, however, is expected to rise a bit in 2025 and 2026.</p>  
<h2 class="wp-block-heading" id="h-revised-economic-outlook"><strong>Revised Economic Outlook</strong></h2>  
<p>In addition, the Fed updated its growth outlooks for this year to 2.5% and 2.1% for 2025. Notwithstanding these issues, the Fed is determined to bring about a balanced recovery of the economy. The labor market has cooled, but the Fed does not expect major changes to employment conditions.&nbsp;</p>  
<p>As inflation remains above target, the Fed will proceed slowly with further rate cuts. Economic uncertainty, including possible policy shifts, adds to the complexity of future decisions. Policymakers are aiming for gradual adjustments to support the economy while managing inflation effectively.</p>  
<h2 class="wp-block-heading" id="h-housing-market-and-future-projections"><strong>Housing Market and Future Projections</strong></h2>  
<p>The Federal Reserve's decision to cut rates is expected to affect the housing market. Although the rate cut aims to boost demand, high mortgage rates will likely persist. This will continue to challenge housing affordability and slow down homebuying. Policymakers revised their forecast for future rate cuts, expecting only two quarter-point reductions in 2025.&nbsp;</p>  
<p>These changes reflect a cautious approach, as the Fed faces persistent inflation and economic uncertainty. The Fed's next rate announcement is set for January 29, 2025, providing further clarity on its path forward.</p> 
<p>The post <a href="https://cryptonewsland.com/us-federal-reserve-reduces-rates-by-0-25-revises-economic-growth-outlook/" rel="noopener noreferrer nofollow">US Federal Reserve Reduces Rates by 0.25%, Revises Economic Growth Outlook</a> appeared first on <a href="https://cryptonewsland.com" rel="noopener noreferrer nofollow">Crypto News Land</a>.</p>

US Federal Reserve Reduces Rates by 0.25%, Revises Economic Growth Outlook

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