Thanks to its latest decision on Wednesday – its final one for 2025 – the Federal Reserve has now reduced its key overnight lending rate by 1.75 percentage points since it began its rate-cutting cycle in September 2024.

The reduction lowers the federal funds rate — what banks charge each other for short-term loans — to between 3.5% and 3.75%, down from its prior range of 3.75% to 4%. The Fed's decision marks the third consecutive rate cut since September, lowering the federal funds rate by a total of 0.75 percentage points this year.

Jerome Powell has concluded his news conference following the announcement that the Federal Reserve will cut the country's key lending rate by a quarter point. This is the third reduction this year brings the key interest rate to 3.50% to 3.75%. Powell affirms the Fed's commitment to keeping inflation low and near the Fed's target.

The Federal Reserve cut its benchmark interest rate by a quarter point for the third time since September, bringing it to about 3.6%, the lowest in nearly three years.

The latest cut brings the target federal funds rate to a range between 3.5 percent and 3.75 percent, the lowest level in three years. This rate affects many consumer lending and savings rates throughout the country, either directly or indirectly, including mortgage rates.

Trump administration live updates: Fed cuts interest rates again; Judge orders Epstein grand jury records released Trump said at a White House event this afternoon that the U.S. military has seized an oil tanker off of Venezuela's coast.

The central bank is poised to lower interest rates on Wednesday even as a growing chorus of officials urge caution.

Jerome Powell’s Federal Reserve will likely deliver its final cut of the year on Wednesday. But Claudia Sahm is already looking ahead.