The Federal Reserve marked down their 2025 and 2026 interest rate outlook, with a softening labor market outweighing concerns about inflation re-accelerating, according to the central bank's updated Summary of Economic Projections published on Wednesday.

After a year of sitting on the sidelines, the Federal Reserve finally cut short-term interest rates by a quarter-point.

Economists surveyed by Bloomberg expect one or two more rate cuts to follow in 2025.