Fed Meeting Live Updates: Powell Set To Lower Interest Rates Again

The Fed is expected to cut interest rates again. What comes next is the biggest question.

There’s a phrase that we Federal Reserve reporters use so much when describing Fed meetings that it might as well be a central banking cliche at this point: What matters most isn’t today’s interest rate announcement, but what the Fed suggests could come next. 

It’s perhaps the most relevant way to describe the Federal Reserve’s final interest decision of the year (releasing today at 2 p.m. ET).

Fed officials are already widely expected to cut interest rates for the third time at their December meeting. Most economists and investors expect it because Fed officials made no effort to walk back those expectations leading up to today’s gathering, even after the latest data revealed that inflation has been stubborn and the job market has been stable. 

What’s been missing, though, is evidence of a unified consensus on what the future could hold. Here are the key areas that are going to be most important to watch at the Fed’s final meeting of the year:

Could the Fed imply that it plans to skip a few rate cuts? Powell has said the data isn’t compelling officials to be in a rush with interest rate cuts. Officials are set to update their quarterly Summary of Economic Projections (SEP), which will reveal where they expect borrowing costs could head over the course of the next three years. Should officials project fewer than four rate cuts for 2025 (what they estimated back in September), it could signal that Fed officials think they’ll need to leave rates unchanged at multiple meetings — a far slower pace than what’s been happening over the past few months. 

Will Fed officials stress that their outlook is even more uncertain? Fed officials are likely going to be even more guarded than usual with the guidance that they give. There’s a lot of uncertainty about what the path for inflation and the economy could look like next year. President-elect Donald Trump’s proposals to raise tariffs on U.S. imports and lower taxes could lead to higher inflation, economists say. Powell, however, will continue to stress that it’s too soon for the Fed to change its tune.