The Fed cut its benchmark interest rate by 25 bps to 3.75%–4.00% at the Federal Open Market Committee (FOMC) meeting on October 29, 2025. This marks the second rate cut in 2025. The decision was driven by concerns over weakening U.S. labor market conditions, amid limited access to economic data due to the government shutdown at the end of October 2025. The Fed Committee assessed that recent indicators are consistent with current developments, in which downside risks to employment have increased alongside rising U.S. inflation.