BOSTON, MA, October 29, 2025 — The Federal Open Market Committee (FOMC) met today to assess the state of the US economy and monetary policy. For the second time this year, the FOMC reduced the Federal Funds Target Rate by 25 bps to a target rate of 3.75-4.00%, matching market expectations. With the government shutdown in its fourth week, the Fed headed into today’s meeting with a lack of official government data. Private surveys continue to point to softening labor market data in recent months, bolstering the case for easing. However, this is complicated by inflation data which continues to print above the Fed’s 2% target and evidence that the inflation rate is no longer declining. The Fed’s dual mandate stands in tension because risks to employment tilt to the downside while risks to inflation tilt to the upside. Given the shift in the balance of risks, the economic outlook, and a policy rate considered to be in modestly restrictive territory, the Fed took a careful step to balance the dual mandate.

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