Fed Cuts Rates 25 BPS Amid Largest Divergence in Six Years, Signals Slower 2025 Path
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Based on BlockTempo, the U.S. Federal Reserve cut interest rates by 25 basis points on December 10, 2025, marking the third rate cut of the year. The decision revealed the largest internal divergence in six years, with three dissenting votes, and signaled a likely slowdown in future rate cuts. The Fed also launched a Reserve Management Purchase (RMP) program to buy $400 billion in short-term U.S. Treasuries over 30 days to address money market pressures. Investors are now adjusting funding rates strategy amid shifting monetary policy. The updated dot plot shows the Fed still expects one 25-basis-point cut in 2026, but the path remains uncertain due to diverging views on inflation and labor market risks. Chair Powell emphasized the Fed's patience in observing economic developments and ruled out any assumption of future rate hikes, which could influence value investing in crypto markets.
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