The reduction lowers the federal funds rate — what banks charge each other for short-term loans — to between 3.5% and 3.75%, down from its prior range of 3.75% to 4%. The Fed's decision marks the third consecutive rate cut since September, lowering the federal funds rate by a total of 0.75 percentage points this year.

President Donald Trump said that Kevin Hassett and Kevin Warsh are his top choices to lead the US Federal Reserve and that he expects the next chair of the central bank to consult with him on interest rates.