{"id":100628,"date":"2025-09-16T00:00:00","date_gmt":"2025-09-16T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2025\/09\/16\/us-fed-set-to-deliver-first-cut-of-2025-as-global-central-banks-line-up-policy-moves\/"},"modified":"2025-09-16T00:00:00","modified_gmt":"2025-09-16T00:00:00","slug":"us-fed-set-to-deliver-first-cut-of-2025-as-global-central-banks-line-up-policy-moves","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2025\/09\/16\/us-fed-set-to-deliver-first-cut-of-2025-as-global-central-banks-line-up-policy-moves\/","title":{"rendered":"US Fed set to deliver first cut of 2025 as global central banks line up policy moves"},"content":{"rendered":"

The Fed is expected to deliver its first rate cut in nine months tomorrow<\/strong>, with a 25 basis point reduction looking like the most likely scenario. A bigger 50 bps cut could be on the table as well amid signs that US job growth is slowing, Bloomberg<\/a> reports. Futures also price further reductions in October and December, and deeper into 2026, as softening consumption and weaker job growth offset concerns about tariff-driven inflation. <\/p>\n

Treasuries have dipped to their lowest in months ahead of the meeting<\/strong>, CNBC<\/a> reports, with the 10-year yield at 4.06%, the 2-year at 3.55%, and the 30-year at 4.68%. <\/p>\n

Everyone\u2019s focus will now shift on the pace of cuts moving forward. <\/strong>Retail sales data due today and jobless claims on Thursday will help shape expectations for the pace of easing, especially as inflation still remains above the Fed\u2019s target. The Fed\u2019s dovish tone, coupled with US President Donald Trump\u2019s pressure on the Fed to cut rates and the last-minute appointment of Trump adviser Stephen Miran as Fed governor<\/a> in time for this week\u2019s meeting, all support the case for a steady string of cuts in the near term. <\/p>\n

Data-driven, but largely political: <\/strong>Bloomberg<\/a> economists frame the move as primarily political, despite the hard data making a case for it in line with the Fed\u2019s mandate, saying, \u201cthe markets expect a rate cut, the White House wants it \u2014 and we think Powell is doing what he sees as needed to fend off further threats to the Fed\u2019s independence.\u201d<\/p>\n

Strategists warn the cut may cool risk appetite.<\/strong> The S&P 500 is up 12% this year on Big Tech and AI momentum, but Morgan Stanley and JPMorgan see scope for profit-taking, Bloomberg<\/a> reports separately. \u201cNear-term risk is centered on the tension between lagging, weak labor data, and the Fed\u2019s response that may not meet the markets\u2019 \u2018need for speed\u2019,\u201d said Morgan Stanley\u2019s Michael Wilson.<\/p>\n

Others remain upbeat: <\/strong>Deutsche Bank and Barclays have raised their year-end S&P targets on the back of tech momentum and strong corporate earnings, while Oppenheimer\u2019s John Stoltzfus expects any dip after the cut to be shallow if US fundamentals hold.<\/p>\n

The Fed decision also kicks off a 36-hour run of central bank moves covering <\/strong>two-fifths of global GDP:<\/strong><\/p>\n