US Fed Reduces Key Interest Rate By 0.25%, Stocks Drop

The US Federal Reserve cut interest rates by 0.25%, lowering them to 4.25%-4.50%, but signaled fewer cuts ahead, surprising markets. Wall Street dropped, and Treasury yields surged. Fed Chair Jerome Powell remained optimistic despite inflation still above target. Analysts expect higher rates longer due to potential tariff hikes under President Trump, which could slow growth and increase inflation.