In its decision, the Fed points out that job growth in the USA has decreased and that unemployment has increased slightly.
The central bank is sending signals that there will be two more cuts this year. Next year, only one cut in the interest rate is expected, writes the news agency AP.
After the announcement of the cut, the stock prices rose slightly before falling back.
The Fed was almost unanimous in its decision to cut 0.25 percentage points. Only the recently appointed member Stephen Miran, who was nominated by the President of the USA Donald Trump, wanted a double cut. Miran is an economic advisor in the White House.
Fed chief Jerome Powell has been subjected to hard pressure from Donald Trump, who has demanded more interest rate cuts and been very aggressive.
Trump has on countless occasions accused Powell of being far too slow to cut interest rates.
Last year, the Fed cut the interest rate on three occasions. Last September, it was cut by 0.50 percentage points, in November by 0.25 percentage points and in December by 0.25 percentage points.
