What happens to stocks when the Fed cuts rates?

UXS video · Stock Indices · 0:48 · Published

UXS video · synthetic voice · Mixkit music · MP4, 4.4 MB

What this video covers

Why the reason for a Fed cut matters more than the cut itself, with the 2001 and 2007–2008 examples. A FRED chart traces the 2025 cuts and the September 2026 hike.

Sources and the longer explanation: What Happens to Stocks When the Fed Cuts Rates?.

Numbers shown on screen

  • 3.64%
  • 3.75–4.00%: Target range after Oct 28, 2026
  • 3.88%: Effective rate, Nov 6, 2026

How the visuals were made

In 0:48 the video moves through 6 scenes, including a side-by-side comparison of Growth cuts and Recession cuts; an animated line chart, “Effective federal funds rate, %”, drawn from FRED series DFF from 2025-01; a checklist, “On the next Fed day”. All graphics were rendered frame by frame by UXS; no stock footage, logos or faces are used.

Chapters

  • 0:00 Rates and stocks: Fed cuts rates. Stocks go up? It depends why
  • 0:05
  • 0:15 Effective federal funds rate, %
  • 0:28 On the next Fed day
  • 0:33 Where policy stands
  • 0:44 Risk note

Transcript

When the Fed cuts rates, do stocks go up? It depends on why it is cutting.

Cuts in a growing economy have often supported stocks. Recession cuts did not prevent big declines, as in 2001 and 2007 to 2008.

In 2025 the effective rate fell from about 4.33% to 3.64% after three cuts. Then, in September 2026, the Fed raised rates.

Markets price in expected cuts early, so read the reason, not just the decision.

After the October 28 meeting, the target range was 3.75% to 4%, and the effective rate was 3.88% on November 6.

Educational only, not financial advice.