The Federal Open Market Committee (FOMC) meeting held on September 16-17 ended up delivering a 25bps rate cut. The minutes of the September FOMC meeting will be released by the US Fed at 2 p.m. ET on October 8.
On September 17, Powell announced a 25bps rate cut, the first rate reduction in 2025, and signalled two more cuts this year and only one in 2026. The next FOMC meeting takes place on October 28-29, while the last meeting for 2025 will take place on December 9-10.
Minutes from last month’s Federal Open Market Committee (FOMC) meeting are expected to be keenly followed by market analysts. These minutes, which provide insights into the committee’s recent views on monetary policy, may influence market expectations regarding future interest rate decisions.
A cautious tone in the minutes of a financial report could lead to temporary support for the dollar, while a confirmed dovish position might induce further selling pressure on the dollar.
September FOMC Voting
In the September FOMC meeting, the 12-member committee, by an 11-1 vote, decided to cut rates by 25 basis points. The only dissenting vote was cast by Stephen Miran, a newly confirmed Trump economic adviser and member of the Fed’s Board of Governors, who advocated for a reduction of the federal funds rate target range by 1/2 percentage point instead.
Fed Governors Christopher Waller and Michelle Bowman, who were appointed by Trump, supported the idea of implementing interest rate cuts sooner but ultimately agreed to a reduction of a quarter-point.
In the press conference, Fed Chair Powell remarked that, within the Federal Reserve’s structure of 19 members, only 12 possess voting rights, indicating that for a single governor to influence a decision significantly, they would need to be exceptionally persuasive.
US Government Shutdown
Meanwhile, the US government shutdown, which has gone into its second week, is creating concerns for the market. The key jobs report scheduled for Friday last week was not published, and this absence of data complicates the decision-making process for Federal Reserve officials, who are set to meet later this month to determine the potential lowering of interest rates.
Economic Data
In the weeks ahead, increasing inflation and potential further deterioration in the job market could negatively impact market conditions. Investors should exercise caution regarding these two factors, as they have the potential to rapidly alter the global investment landscape.
Should the government shutdown persist, various important releases will be postponed. These include the Census Bureau’s data on imports and exports, wholesale trade statistics, inventory figures, and key jobless claims data from the Labor Department.
September 2025 CPI data are scheduled to be released on October 15, 2025.
Meanwhile, markets have surged, with the S&P 500 and Nasdaq achieving all-time highs, fueled by a wave of deal-making in the artificial intelligence (AI) sector.