A third rate cut in a row. Money is getting a little cheaper.
The Federal Reserve lowered its target range to 3.50%–3.75%, but signalled fewer cuts ahead. Here is how growing businesses can use the window.
By the Xuru Technologies team · 11 December 2025
Key takeaways
- On 10 December 2025 the Fed cut its benchmark rate by a quarter point to 3.50%–3.75%.
- The decision was divided, with officials disagreeing about inflation and jobs.
- Borrowing for equipment, property and growth projects becomes slightly cheaper going into 2026.
After three cuts since September, the cost of credit is easing. It is not a return to cheap money, but it tilts the maths toward investing in growth projects that were on hold.
What happened
The Federal Reserve cut interest rates for the third straight meeting, NPR reported, with several officials dissenting. The Mortgage Reports explained what the move means for home loans and credit lines.
What it means for small businesses
- Credit lines ease. Variable-rate loans and cards tied to the prime rate get a little cheaper.
- Property moves. Lower mortgage costs can lift buyer activity in spring.
- Consumers spend. Lower borrowing costs support demand in hospitality and retail.
Where growth investment pays back fastest
| Investment | Why now |
|---|---|
| Website rebuild | A faster, clearer site lifts conversion on all marketing spend. |
| Booking and payments | Removes friction just as consumer demand improves. |
| AI automation | Reduces admin hours, the cost that keeps rising. |
| SEO content | Builds traffic that does not depend on ad prices. |
Frequently asked questions
What is the Fed funds rate after December 2025?The target range is 3.50% to 3.75% after the 10 December 2025 cut.
The target range is 3.50% to 3.75% after the 10 December 2025 cut.
Will the Fed keep cutting in 2026?Officials signalled a slower pace. Future moves depend on inflation and jobs data, so plan for modest changes.
Officials signalled a slower pace. Future moves depend on inflation and jobs data, so plan for modest changes.
Should a small business borrow to invest now?Only for projects with a clear payback. Speak to your bank or adviser; this is general information, not financial advice.
Only for projects with a clear payback. Speak to your bank or adviser; this is general information, not financial advice.
Invest where it pays back fastest.
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