Federal Reserve Cuts Rates as High Prices Persist Despite Cooling Inflation

Washington, Saturday, 13 December 2025.
In December 2025, the Federal Reserve announced its third interest rate cut of the year, targeting a range of 3.50%-3.75% as inflation data shows signs of cooling. However, an analytical review reveals a stark contrast between improving macroeconomic indicators and the financial strain felt by American households. Despite the Fed projecting stronger GDP growth of 2.3% for 2026, consumer sentiment remains dampened by a cumulative “sticker shock” affecting essentials like food and housing. With ground beef prices up 14% and housing costs elevated since the current administration took office, the persistent affordability crisis presents a significant political hurdle, challenging the effectiveness of campaign promises to lower costs against the reality of entrenched price levels.