Fed's 'Hawkish Cut': Signals Only 2 Cuts in 2025 vs 4 Expected

The Federal Reserve cut rates by 25 basis points to 4.25–4.50% but delivered a hawkish surprise: the December SEP (Summary of Economic Projections) projected only two cuts in 2025, half the four expected by markets. Chair Powell's press conference reinforced the cautious stance. The US dollar surged and equity markets sold off sharply — the S&P 500 fell ~3% on the day.