Fed Rate Decision December 2025: The Most Important Meeting of the Year

By Jerry Robinson, CEO, NMLS 4475 | 1st Choice Mortgage

The Fed Rate Decision December 2025 announcement is shaping up to be a cliffhanger. For the first time since mid-2024, a rate cut is not a done deal. While the market is pricing in an 85% chance of a cut, this meeting - scheduled for December 10th - has all the ingredients for a surprise that could ripple through the Idaho housing market.

Usually, by this time of year, we have a clear roadmap. But with a government shutdown delaying key jobs data and the Federal Reserve members split on their forecasts, this Wednesday is shaping up to be the most interesting announcement in over a year.

At 1st Choice Mortgage, we are tracking every basis point. Here is the reporter-style breakdown of what to expect next week and, more importantly, what it means for your mortgage rate.

The “Blind” Decision: Missing Jobs Data

The Federal Reserve usually prides itself on being “data-dependent.” The problem? The data is missing.

Due to the recent government shutdown, the pivotal November Jobs Report - originally scheduled for release today - has been delayed until December 16th.

This puts the Fed in a unique bind. They have to make a decision on December 10th without knowing the full health of the labor market. It's a bit like flying a plane in the fog; you trust your instruments, but you'd really prefer to see the runway.

The “Dot Plot” Threat: Why a Rate Cut Might Not Lower Rates

Even if the Fed cuts its benchmark rate by 0.25% as expected, mortgage rates might not drop. In fact, they could go up. Why?

It comes down to the “Dot Plot.”

Four times a year, Fed members release a chart showing where they personally think rates will be in the future. This meeting includes an updated plot.

• The Risk: If the Fed cuts rates today but the “dots” show they plan to stop cutting in 2026, the market could react negatively.
• The Reality: Mortgage rates follow long-term expectations, not just today’s fed funds rate. A “hawkish cut” (cutting now but signaling a pause later) could push mortgage rates higher.

Current Market Status: The “Sideways” Trend

While we wait for the Fed, mortgage rates have been moving sideways. Since early September, the 30-year fixed rate has hovered near its lowest levels since late 2024, refusing to break out in either direction.

Current National Averages:

• 30-Year Fixed: ~6.27%
• 15-Year Fixed: ~5.76%
• 30-Year VA: ~5.90%

Note: These are national averages. Your individual rate in Boise, Meridian, or Nampa will depend on your credit score and equity.

Frequently Asked Questions (FAQ)

1. Will mortgage rates drop immediately if the Fed cuts rates?

Not necessarily. Mortgage rates often “price in” the cut weeks before it happens. If the market already expects a cut (which it does, at 85% probability), the actual announcement might not move the needle much unless the Fed says something surprising about 2026.

2. Why is the jobs report delay a big deal?

The Fed has a dual mandate: stable prices (inflation) and maximum employment. Without the November jobs report, they are missing half the picture. If the jobs report (released Dec 16) ends up being weaker than expected, the Fed might regret not cutting more aggressively.

3. What should I do if I’m under contract right now?

Volatility is the enemy of a good night’s sleep. If you are closing in December, locking your rate before the December 10th announcement is the safest play. If the “Dot Plot” is gloomy, rates could spike quickly.

4. How does the 10-Year Treasury impact my rate?

Mortgage rates tend to track the 10-Year Treasury yield, not the Fed Funds Rate. Currently, the 10-Year Treasury is sitting around 4.13%, which is keeping mortgage rates in the low 6% range.

Don’t Gamble on the Fed

Trying to time the market is tough, especially when even the Federal Reserve is waiting on delayed data.

Contact us today. We can help you lock in a rate that makes sense for your budget, regardless of what the “dots” say next week.

1st Choice Mortgage Company
NMLS 380736
jerry@375loan.com
(208) 375-5626

Disclaimer: This post is for educational purposes only. Rates, market forecasts, and Fed predictions are subject to change. Rates cited are national averages as of Dec 5, 2025.