FOMC Doves Take the Lead After Latest Cut
18 September 2025
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The Federal Reserve delivered a 25-basis-point rate cut today, signaling that two additional reductions are likely before the end of the year. The decision underscored growing dovish momentum inside the FOMC, with only one dissent.
Policy Divide
Newly appointed Governor Stephen Miran pushed for a larger 50-basis-point cut, but his call was not backed by other members. Governors Michelle Bowman and Christopher Waller, previously thought to lean dovish, aligned with Chair Jerome Powell in supporting the quarter-point move.
Powell’s Message
In his press conference, Powell stressed that labor market risks were the central factor behind today’s cut. He noted that employment weakness poses greater downside risk to the economy than inflation pressures at this stage.
Market Reaction – Gold Volatility
Gold prices swung violently in the immediate aftermath of the Fed’s announcement. On the hourly chart, XAU/USD spiked to a high near 3,707 before plunging more than 600 pips in a single candle to bottom around 3,646. Since then, the metal has stabilized near 3,660, with 3,646 acting as immediate support and 3,707 as short-term resistance.
