The Federal Open Market Committee voted to cut target interest rates by 50 basis points due to improved confidence that inflation is moving sustainably toward its 2% goal.
Rate Decision: The rate cut—the first since 2020—lowers the federal funds rate to a range of 4.75% to 5.0%. Federal Reserve Governor Michelle Bowman was the sole dissenting vote, preferring to lower rates by 25 basis points.
Economic Projections: In its latest economic projections, the Federal Reserve estimated lower gross domestic product growth, higher unemployment, and lower inflation than it projected in June. It also projected another 50 basis points in cuts by the end of the year and a full percentage point in cuts next year.