Fed Meeting on Thursday: Will the US Finally Cut Rates?

The Federal Reserve’s upcoming meeting on September 16-17, 2025, has captured the attention of investors worldwide. 

With the federal funds rate currently at 4.25% to 4.50%, markets are eager to see if this will be the Fed’s first rate cut of the year.

Weaker job numbers have fueled speculation that the central bank may pivot, but Fed officials remain cautious. The decision, set to be released on September 17 at 2 PM ET, could have wide-reaching effects on stocks, bonds, crypto, and the global economy.

Why the Fed Might Cut Interest Rates

Recent data showing slower job growth and cooling inflation has increased pressure on the Fed to ease monetary policy. 

Rate cuts are typically used to stimulate growth, lower borrowing costs, and support financial markets.

Key reasons a cut is on the table include:

• Weakening labor market signals
• Inflation trending closer to the Fed’s 2% target
• Growing concerns over economic slowdown
• Market volatility and global uncertainty

Still, Fed Chair Jerome Powell has stressed that the decision depends on evolving data, making this meeting a pivotal moment.

What Happens if the Fed Cuts Rates?

If the Fed delivers a rate cut, the immediate impacts could include:

• Lower borrowing costs for businesses and consumers
• A boost in stock and crypto markets due to improved liquidity
• Pressure on the U.S. dollar, possibly lifting commodities like gold and oil
• Shifts in Treasury yields as investors adjust expectations

Crypto traders, in particular, watch rate cuts closely as looser monetary policy can drive more capital into risk assets.

Read more: Bitcoin Price Analysis Ahead of Federal Reserve Rate Decision 2025

What If the Fed Holds Steady?

If no rate cut happens, it signals the Fed still sees inflation or economic risks that warrant patience. The outcomes could be:

• Short-term disappointment in equity and crypto markets
• Continued high borrowing costs for mortgages, credit, and corporate debt
• Greater focus on future Fed projections for possible cuts later in 2025

Markets will also pay close attention to the Summary of Economic Projections, which outlines where policymakers see rates heading in the months ahead.

Market Expectations for the Fed Decision

Traders are pricing in a strong chance of a rate cut, but not all analysts are convinced. The Fed may prefer to wait for more clarity on inflation before moving.

For investors, this means preparing for both scenarios: a cut that sparks optimism, or a hold that reinforces caution until later in the year.

Read more: Nasdaq Pushes SEC Approval to Tokenize Stocks on Blockchain

Final Thoughts

The Fed meeting this Thursday could mark a turning point in U.S. monetary policy. Whether rates are cut or left unchanged, the decision will ripple through global markets. 

Investors should brace for volatility while keeping an eye on the Fed’s forward guidance for the rest of 2025.

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FAQs

When is the next Fed meeting?

The Fed meets on September 16-17, 2025, with the policy statement released on September 17 at 2 PM ET.

What is the current federal funds rate?

The rate stands at 4.25% to 4.50%, unchanged since December 2024.

Why might the Fed cut rates?

Weaker job growth, easing inflation, and concerns over economic slowdown are fueling expectations of a cut.

How would a rate cut affect crypto?

Lower interest rates can push investors toward risk assets like crypto, potentially boosting demand and prices.

What if the Fed doesn’t cut rates?

Markets may react with short-term volatility, and investors will shift focus to future meetings for potential cuts.