The Federal Reserve’s most recent move was a 0.25 percentage point (25‑basis‑point) cut to its benchmark federal funds rate, bringing the target range to 3.5%–3.75% after its latest policy decision.

Quick Scoop

  • The Fed trimmed its main policy rate by 25 basis points in its latest cut.
  • That move lowered the federal funds rate to a 3.5%–3.75% target range, from the prior range that was 0.25 percentage points higher.
  • It was described as the Fed’s third straight 25‑bp cut , signaling a gradual easing rather than a big emergency-style move.

What Exactly Was Cut?

When people ask “how much did the Feds cut interest rates,” they usually mean the federal funds rate , the short‑term rate banks charge each other for overnight loans, which heavily influences broader borrowing costs.

  • In the latest decision, the policy rate was reduced by 0.25 percentage points.
  • After the cut, the Fed also aligned related tools: the interest on excess reserves and the discount rate were adjusted around the new 3.5%–3.75% range to keep policy consistent.

Why This Matters Now

Even though inflation pressures have eased from their peak, the Fed is trying to balance:

  • Keeping inflation on track toward its 2% goal without choking off growth.
  • Avoiding overly aggressive cuts that could overstimulate an economy already projected to grow around 2.3% in 2026 , which is above the Fed’s long‑run growth estimate.

Because of that, markets and analysts see this 25‑bp move as part of a cautious easing path , not the start of a rapid plunge in rates.

Information gathered from public forums or data available on the internet and portrayed here.