Divided US Fed Backs Second Quarter‑Point Rate Cut!

Divided US Fed Backs Second Quarter‑Point Rate Cut!

Reported by Marian Opeyemi Fasesan | Sele Media Africa

The Federal Reserve announced its second consecutive 0.25 percentage‑point reduction in its benchmark interest rate on Wednesday, lowering the target range to 3.75 %–4 %. The move comes amid signs of labour‑market weakness and ongoing inflation concerns — but also highlights divisions within the central bank’s ranks. [1]

What We Know

• The rate cut was driven by mounting evidence that job growth is slowing and that downside risks to employment have risen. [2]
• In its statement, the Fed said future policy is “not on a preset course,” reflecting internal debate over whether more‑aggressive easing is warranted. [2]
• Some officials pushed for a larger 0.50 point cut, while others argued caution given inflation remaining well above the Fed’s 2 % target. [1]

Why It Matters

• The Fed’s decision underscores a key policy‑trade‑off: supporting employment vs. controlling inflation.
• The split in the Board suggests that markets and observers should not assume further cuts are inevitable — the path ahead remains uncertain.
• For global markets, the cut affects borrowing costs, currency valuations, and cross‑border capital flows — all of which are important for emerging economies like Nigeria.

What to Watch

• Whether the labour‑market data in coming weeks (non‑farm jobs, wage growth, unemployment) prompts further easing or a pause.
• If inflation episodes (especially energy/food) begin again, the Fed may shift back to a more hawkish stance.
• Implications for emerging markets — a weaker USD or looser US policy could ease global financing conditions.

Citations:

1. Financial Times: www.ft.com/content/dd938de1-f8c3-4e5f-b58b-412ac80579fd?utm_source=chatgpt.com
2. The Washington Post: www.washingtonpost.com/business/2025/10/29/fed-cuts-interest-rates-data-trump/?utm_source=chatgpt.com

About The Author

Marian Opeyemi Fasesan

editor

Marian Opeyemi Fasesan is a dynamic journalist and editorial leader committed to excellence in news reporting and storytelling. As the Editor-in-Chief of Sele Media Africa, she ensures daily operations run smoothly while upholding the highest editorial standards. With a strong eye for detail and deep understanding of audience engagement, Marian coordinates content across platforms, guiding teams to produce compelling, timely, and credible news. Her leadership reflects the heart of Sele Media Africa’s mission—to inform, inspire, and elevate voices across the continent.

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