Market history · Central banks ·
The Fed cuts again, and markets fall
On 18 December 2024 the Federal Reserve lowered its target range by a quarter point, to 4.25–4.50%, its third cut in a row. Beth Hammack dissented, preferring to hold the range at 4.50–4.75%.
Even so, stocks fell sharply that afternoon, because the projections published alongside the decision pointed to fewer cuts in 2025 than investors had hoped for. It was a reminder that markets respond to what a central bank signals about the future, not only to what it does today.
The takeaway
A cut can feel like a tightening if it is smaller than expected or signals fewer to come.
This is a retrospective about a past event, provided for general information. It is not investment advice, does not describe RockLake's positioning at the time, and past performance is not a guide to future performance. Read the risk warning.