Fed Cuts Rates by 0.25% and Announces End of QT
On October 29, 2025, the U.S. Federal Reserve officially:
- Cut interest rates by 25 basis points, and
- Announced the end of Quantitative Tightening (QT), with a shift toward a more accommodative stance starting December 1, 2025.
This marks the beginning of a monetary policy pivot (a move from contractionary to expansionary policy) and may signal the start of a new phase in the global macro cycle.
Fed Chairman addresses the media following the decision to cut interest rates by 0.25% and conclude QT by December 2025 — signaling a major shift in monetary policy.
What Does This Mean?
Positive News for Risk Assets
The policy shift arrives early in the business cycle, as suggested by the ISM PMI, which currently sits around 49. While still technically in contraction territory, this marks a steady rise from the 46 levels observed in mid-2023. The economic trend is improving, but far from overheating.
This type of environment typically supports —a backdrop in which assets like equities and crypto historically perform well.
Retail MMF vs S&P500 — The ratio is near historical lows, suggesting that equities are heavily capitalized and potentially overvalued relative to retail liquidity.**
Retail MMF vs Bitcoin — The ratio is at historic lows, similar to previous market tops in 2021, signaling that Bitcoin may be overheated relative to available liquidity.
Retail MMF vs Gold — Gold still shows potential upside compared to past cycles, unlike equities and Bitcoin which are closer to historical extremes.