Fed rate cut announcement today: probability, live stream, date, time, and how to watch

The economy has had a volatile year marked by ongoing headwinds and uncertainties. Persistent inflation, unpredictability around tariffs, and a stock market that many fear is in the midst of an AI-fueled bubble are among the factors impacting consumers’ spending power.

But there is one event today that will hopefully deliver some much-needed certainty to the economy and broader markets: the Federal Reserve’s interest rate cut announcement. Here’s what you need to know about a possible Fed rate cut today.

What is the Fed rate cut announcement?

The Federal Reserve is America’s central bank. One of its main responsibilities is setting the country’s interest rates. These interest rates are set by the Fed’s primary policymaking body, called the Federal Open Market Committee (FOMC). The FOMC is led by the chair of the Federal Reserve, who is currently Jerome Powell.

The FOMC considers a wide array of data that informs its decision to cut interest rates or not. That data includes labor reports, inflation rates, consumer confidence numbers, and gross domestic product (GDP) information.

Once the FOMC analyzes the data, the body will vote to do one of three things: raise interest rates, lower interest rates, or keep interest rates where they are. The current Fed interest rate is 3.75% to 4.00% (375 to 400 basis points).

What are the benefits of a Fed rate cut?

The main benefit of cutting interest rates is that it lowers the cost of borrowing money. If money is cheaper to borrow, consumers are more likely to take out loans, including mortgages, car loans, and increased credit card spending.

Businesses are also more likely to take out loans, since borrowing is cheaper. Companies typically use loans to expand their operations, boost hiring, or buy needed equipment or supplies.

Since borrowing is cheaper, lower interest rates can inject more money into the economy, thereby increasing spending.

Lower interest rates can also boost the stock and cryptocurrency markets, because when interest rates are lower, safer assets like bonds have a lower rate or return. This spurs investors to put their money into riskier assets, such as stocks or cryptocurrencies, because they have the potential for higher returns.

What are the drawbacks of a Fed rate cut?

Low rates aren’t always a good thing. There are drawbacks to lower interest rates, too.

When interest rates are lower, anyone with a savings account earns less interest. This can especially hurt retirees, who often have more cash parked in savings accounts than their younger peers, and who may rely on their monthly interest earnings to pay for necessities.

Also, while lower interest rates can make everything from houses to cars more affordable, a plethora of cheaper money in the economy can have an inflationary effect, causing prices to rise, which negates the savings gained by the lower interest rates.

What is the likelihood of a Fed rate cut?

Right now, the current Federal Reserve interest rate is 3.75% to 4.00% (375 to 400 basis points).

The Federal Reserve and Powell are under extreme pressure from the Trump administration to lower rates. Because borrowing money would then be cheaper, lower rates would make many Americans feel like their money is going further as the holidays progress and we head into the new year.

That would be a political win for President Trump.

But the Fed is supposed to be politically neutral, and Powell has shown no signs that he or the FOMC will make a decision based on politics.

That said, while many expect the Fed to lower interest rates today, it likely won’t be by much.

Data compiled by the Chicago Mercantile Exchange (CME) Group’s Fed Watch shows an 89.9% chance that the Fed will reduce rates by a 25-basis-point range today.

If that scenario plays out, it means the federal interest rate range would drop from 3.75% to 4.00% (375 to 400 basis points) to 3.50% to 3.75% (350 to 375 basis points).

When is the Fed rate announcement?

The Federal Reserve’s calendar says it will announce its interest rate decision today, Wednesday, December 10.

What time is the Fed rate announcement?

The Federal Reserve’s interest rate announcement will be made at 2 p.m. ET today.

How are stocks performing ahead of the announcement?

Markets seem to be holding their collective breaths ahead of the Fed’s rate cut announcement today. As of the time of this writing, in premarket trading, S&P, Dow, and Nasdaq futures are all relatively flat:

S&P Futures: down 0.04%
Dow Futures: down 0.06%
Nasdaq Futures: down 0.12%

How are crypto markets performing ahead of the announcement?

Many major cryptocurrencies are currently up over the past 24 hours ahead of the announcement. This suggests that crypto traders expect the Fed to cut rates, which could spur a rally in crypto markets. As of the time of this writing, here’s how major cryptocurrencies are performing: