Wall Street witnessed a sharp decline on Wednesday following remarks by US Federal Reserve Chairman Jerome Powell, suggesting that a rate cut in December is not guaranteed. The statement triggered selling pressure across major indices — the Dow Jones Industrial Average, Nasdaq Composite, and S&P 500, all of which fell close to 1% in late trading hours.
Market Reaction Post-Fed Comments
After the Federal Open Market Committee (FOMC) announced a 25 basis points rate cut, Powell clarified that further easing of monetary policy would depend on upcoming economic data. His statement — “A further reduction in the policy rate at the December meeting is not a foregone conclusion, far from it” — led investors to reassess expectations for future cuts.
The Nasdaq Composite dropped 0.92%, reaching an intraday low of 23,763.99 points before slightly recovering to 23,897.96 points. The Dow Jones Industrial Average slipped 0.80%, touching a low of 47,473.39 points, while the S&P 500 fell 0.82% to an intraday low of 6,851.91 points.
Fed Policy Decision and Outlook
In its October 29, 2025 policy statement, the US Federal Reserve cut the benchmark interest rate by 25 basis points, setting the target range between 3.75% and 4.00%. The decision aimed to support the economy amid slowing global growth and persistent inflationary challenges.
The Fed emphasized that future decisions will be data-driven, focusing on the evolving balance of risks in the economy. Market analysts believe that while the current rate cut signals a cautious approach toward growth support, Powell’s remarks indicate no aggressive easing ahead.
Broader Market Implications
Investors reacted cautiously as Powell’s comments dampened optimism for multiple rate cuts in upcoming policy meetings. The remarks caused bond yields to fluctuate, while the US dollar strengthened slightly amid renewed uncertainty.
Market experts suggest that the coming weeks will see heightened volatility as investors closely monitor employment data, inflation figures, and corporate earnings to gauge the Fed’s next move.
Key Takeaway
The mid-week market decline reflects Wall Street’s sensitivity to Fed guidance, with traders recalibrating their expectations for the year-end policy stance. Until clearer economic signals emerge, analysts expect a sideways trading pattern with possible short-term dips across major US indices.
.png)
.jpg)
0 Comments