The Federal Reserve delivered a highly anticipated interest rate cut on Thursday, reducing rates by 25 basis points (0.25%) just one day after President Trump secured a decisive electoral victory. This marks the Fed’s second consecutive rate reduction following a larger 50-basis-point cut in September. With the recent move, the central bank’s benchmark rate now rests between 4.5% and 4.75%.
Federal Reserve Chairman Jerome Powell faced reporters after the announcement, standing firm in his commitment to stay on as head of the Fed, even if asked to step down by President Trump. When a reporter asked, “If [Trump] asked you to leave, would you go?” Powell responded plainly, “No.” In a follow-up question, the reporter probed whether Powell believes he has a legal obligation to stay in his role if requested to leave. Powell answered simply, “No.”
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This latest rate adjustment underscores the Fed’s ongoing efforts to stabilize the economy and maintain favorable financial conditions amid a turbulent political climate. CNBC noted that the decision came as “the Federal Reserve approved its second consecutive interest rate cut Thursday, moving at a less aggressive pace than before but continuing its efforts to rightsize monetary policy.” By lowering the benchmark overnight borrowing rate to the target range of 4.50%-4.75%, the Fed aims to influence broader economic activities by adjusting rates that affect mortgages, credit cards, and auto loans.
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