The Big Sip
The take: The Fed put jobs first. Cutting now is the right move.
What happened: On September 17, 2025, the Fed cut rates by 0.25 percentage points (25 basis points) to 4.00–4.25 in an 11–1 vote. New governor Stephen Miran wanted a 0.5-point cut.
Why it matters: August added only 22,000 jobs. Unemployment is 4.3%. Inflation is 2.9%. The risk to jobs now slightly outweighs the higher prices.
What to watch: Markets expect another 0.25-point cut on 28–29 Oct, and a third in December if hiring stays weak.
Reciepts
• The Fed’s statement and implementation note spell out the range and the lone dissent [Primary]. Federal Reserve+1
• Reuters’ wrap confirms two more cuts pencilled in this year [Report]. Reuters
• BLS shows August’s thin job creation and the 911k downward benchmark revision that reset the year’s story [Report]. Bureau of Labor Statistics+1
• A counter-read: political pressure around Lisa Cook and Miran’s fast confirmation made this “the most charged” Fed week in years [Analysis]. Reuters+1
The cut was so expected that traders switched to decaf.
Here’s The Brew
Cutting rates wasn’t politics. It was risk management.
The moment the decision hit, markets barely blinked.
They had priced it in for weeks.
When hiring stalls, a cautious trim buys time, even with tariffs nudging prices.
Politicians love shouting “go bigger,” but households pay if the Fed waits and jobs disappear.
Independence is boring by design, but boredom keeps people employed.
Minor cuts today are better than big layoffs tomorrow.
A 50 basis point cut would’ve been nicer though!
Two Sides, One Mug
Pro: Cutting now cushions a cooling labour market before layoffs compound.
Con: Lower rates risk a weaker dollar, pricier oil, and imported inflation.
Our read: Jobs risk dominates. Cut, then cut again if the data warrants it.
Receipt of the Day
FOMC statement + Implementation Note (17 Sep 2025) — Confirms 4.00–4.25% target range, lists the 11–1 vote, and records Miran’s push for 50 bps. Federal Reserve+1
Spit Take
“Unemployment 4.3 percent, highest since 2017.” — BLS
Coffee Break Links ×3
Reuters live + wrap: The cut, the dissent, and two more trims flagged. [Report] Reuters
BLS CPI: Why 2.9% isn’t “done with inflation.” [Report] Bureau of Labor Statistics
Fed calendar: Your next rate-risk date is 28–29 Oct. [Report] Federal Reserve
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Mugshot Poll
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