Fed 'Well-Positioned' After Neutral-Range Rate Cut, Powell Says

03:18 PM EST, 12/10/2025 (MT Newswires) -- After rate cuts at the last three Federal Open Market Committee meetings, the policy rate is in the range of neutral, giving the FOMC time to observe how the US economy evolves as more data are released, Federal Reserve Chair Jerome Powell said Wednesday at a press conference.

"The adjustments to our policy stance since September bring it within a range of plausible estimates of neutral and leave us well-positioned to determine the extent and timing of additional adjustments to our policy rate based on incoming data," Powell said, adding that no one sees a rate increase as the next move.

Powell repeated that there is "no risk-free path for policy as we navigate this tension between our employment and inflation goals." As a result, the FOMC is "well-positioned to wait and see how the economy evolves from here," he said.

The FOMC lowered the federal funds rate target by 25 basis points to a range of 3.50% to 3.75%, with three dissents. Governor Stephen Miran favored a larger 50-basis point reduction, while Chicago Fed President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid preferred no change. Six participants submitted expectations of no change for this meeting in their SEP responses.

The updated Summary of Economic Projections still sees a median of one cut in 2026, another in 2027, and none in 2028, unchanged from the prior SEP. For 2026, the median GDP forecast was revised higher, while overall and core inflation projections were trimmed.

The FOMC said reserve balances are ample but will purchase shorter-term Treasury securities as needed to maintain supply, with Powell noting that these issues are separate from and have no implications for the stance of monetary policy.

"The committee judged that reserve balances have declined to ample levels," Powell said. "Accordingly, at today's meeting, the committee decided to initiate purchases of shorter-term Treasury securities, mainly Treasury bills, for the sole purpose of maintaining an ample supply of reserves over time."

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.