Fed trims rate cuts by a further 25 bps as central bankers brace for an uncertain time for monetary policy

The US Federal Reserve cut interest rates for the second time, this time by 25 bps, bringing it to 4.5%-4.75%, it said in a press release on Thursday. The decision comes just a day after Donald Trump was voted president, with many investors now expecting a less certain path for monetary easing due to an anticipated rise in inflation when Trump begins to implement US tariffs and extend tax cuts.

The path ahead is uncertain, Powell says: Powell said he does not expect any “near-term” impact from the elections on monetary policy — but further down the line, nothing is set in stone. “We don’t know what the timing and substance of any policy changes will be,” Powell said. “We therefore don’t know what the effects on the economy would be, specifically whether and to what extent those policies would matter for the achievement of our goal variables: maximum employment and price stability.”

Powell left the door open for a potential policy pause during a press conference, refusing to rule anything out — though he committed to further rate cuts in the future, Reuters reports. The next meeting will take place on 17-18 December.

Market reax: The S&P 500 and Nasdaq both notched record highs, extending a rally that began in the wake of Trump’s reelection.

THE CLOSING BELL: TADAWUL-

The TASI rose 0.3% on Thursday on turnover of SAR 7.5 bn. The index is up +1.4% YTD.

In the green: Rasan (+7.1%), Miahona (+6.8%) and Theeb (+6.6%).

In the red: Maaden (-4.1%), Al Hokair Group (-3.2%) and Acwa Power (-3.0%).

THE CLOSING BELL: NOMU-

The NomuC rose 1.4% yesterday on turnover of SAR 119.1 mn. The index is up 19.3% YTD.

In the green: Apico (+11.5%), Al Jouf Water (+10.7%) and Raoom (+9.8%).

In the red: Al Mohafaza for Education (-6.2%), Meyar (-5.1%) and Watani Steel (-4.8%)