Fed signals caution: fewer rate cuts despite November cut delivered

Fed cuts rates but warns that future cuts in 2025 will be more limited — markets react to cautious tone.

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Fed signals caution: fewer rate cuts despite November cut delivered

Fed signals caution: fewer rate cuts despite November cut delivered
Although the Federal Reserve cut interest rates by 25 basis points recently, it signalled a more cautious trajectory going forward, forecasting just two cuts in 2025. The cautious tone spooked equity markets, with major U.S. indices reacting sharply as investors priced in fewer monetary easing actions than previously expected. 
Treasury yields also rose on the re-pricing, and the dollar strengthened. The message from the Fed: don’t assume a deep or fast-cut cycle remains on the table.