The Fed is likely to cut rates for the first time this year. Here's what that means for credit cards and housing costs

"America's central bank is probably on the edge of its first rate cut of 2025. The Federal Reserve is meeting for the sixth time this year. At every previous meeting in 2025, they've opted to hold rates steady, but that's set to change. Wednesday's decision isn't a sure thing, but CME FedWatch estimates a near-100% chance of a cut."

"Powell signaled that the Fed could be ready for a policy change in his Jackson Hole keynote last month. "While the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers," Powell said, adding, "with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.""

"The expected cut could provide relief for borrowers and trickle down to American consumers, especially those looking to purchase homes, buy cars, take out loans, and use credit cards. But Stephen Kates, a financial analyst at Bankrate, said it won't be a sign of celebration or economic health. "This isn't the victory parade over conquering inflation," Kates said. "This is potentially making a cut because the economy is faltering, and that's not necessarily a good thing.""

The Federal Reserve is expected to announce its first interest-rate cut of 2025 at its sixth meeting this year, with markets pricing in a near-certain move. Recent data show softer job growth, a gradual rise in unemployment, and inflation creeping back up, shifting the Fed's outlook. Political pressure from President Trump has increased scrutiny of the Fed, but Chair Jerome Powell says decisions will follow the dual mandate of maximum employment and stable prices. A rate cut could lower borrowing costs for consumers and businesses but likely will not majorly reduce mortgage or credit rates immediately.

Read at Business Insider