The Federal Reserve on Wednesday cut interest rates for the first time in 2025 and released policymakers' quarterly forecast of economic conditions that shows the potential outlook for further rate cuts, as well as inflation and the labor market.

The 25-basis-point cut lowered the benchmark federal funds rate to a new range of 4% to 4.25%, after rates were held steady at the first five meetings of this year amid economic uncertainty regarding the labor market and inflation amid tariff shifts and immigration policy changes.

Despite inflation remaining above the Fed's 2% target and tariffs expected to push inflation higher into next year, the Fed cut rates in response to signs of softness in the labor market in recent jobs reports.

The Federal Open Market Committee (FOMC), which guid

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