Fed lowers rates but sees fewer cuts ahead

WASHINGTON — The US Federal Reserve on Wednesday slashed interest rates by 25 basis points, the third consecutive rate cut in this easing cycle, while signaling a slower-than-expected pace of easing next year.

Fed officials estimated two interest rate cuts next year, fewer than four projected in September. They also marked up their projections for core inflation and economic growth next year, while lowering their forecast for the unemployment rate.

Federal Reserve Chair Jerome Powell said more reductions in borrowing costs hinge on further progress in lowering stubbornly high inflation.