A Fed rate cut, but also rising imposed uncertainty

Economy Watch · Sep 17, 2025 · 4m

Kia ora,

Welcome to Thursday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.

I'm David Chaston and this is the international edition from Interest.co.nz.

And today we lead with news financial markets are struggling to make sense of the US Fed's latest rate cut rationale, one that looks infused with new White House politics.

First up this morning, the US central bank cut its policy rate by -25 bps to 4.25% as expected, despite noting that American inflation is "somewhat elevated". It is their first reduction in borrowing costs since December…