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Fed Cuts Key Rate by Quarter Percentage Point; Trump's New Pick for Fed Reserve Board Dissented, Wanted Larger Cut; Ex-CDC Director Monarez Says RFK Jr. Told Me to Commit in Advance to Approving Every Decision by Vaccine Committee Regardless of Scientific Evidence; King Charles Hosts Trump & First Lady Melania at Windsor Castle; Trump Makes Unprecedented Second State Visit to U.K. Aired 2-2:30p ET

Aired September 17, 2025 - 14:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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[14:01:05]

BRIANNA KEILAR, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": The Federal Reserve just cut interest rates. President Trump has demanded a cut for months, but the Fed knows that there is a risk and any cut could increase inflation and hit Americans where it hurts. Politics versus public health, the fired Director of the CDC visits Capitol Hill with a message for lawmakers and sharp words for HHS Secretary Robert F. Kennedy Jr.

BORIS SANCHEZ, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": And too hot for our health. A new report underscoring the dreadful cost of heat waves during summer and holding a warning for the future. We're following these major developing stories and many more, all coming in right here to "CNN News Central."

KEILAR: We begin with our major breaking economic news. The Federal Reserve announcing its decision on whether to make its first interest rate cut this year, and it's happening after months of pressure from President Trump. Let's go straight to CNN's Matt Egan. He is live for us at the Federal Reserve Headquarters here in Washington. Tell us about this decision, Matt.

MATT EGAN, CNN SENIOR REPORTER: Yeah, Brianna, the Fed just delivered an interest rate cut and it is the quarter point cut that was widely expected. Now, this is a big deal because it is the first interest rate cut of the second Trump administration and it's sending a clear message that Federal Reserve officials are more worried about the slumping job market than they are about stubborn inflation. They're acting now to try to shore up the job market before this trouble turns into something worse.

And they're signaling this concern in their new statement that they just put out by inserting some new language that I'll read to you. Now, Fed officials say that job gains have slowed and the unemployment rate has edged up, but remains low. Fed officials also say that they have judged the downside risks to employment have risen. Now at the same time, this statement also says that inflation has moved up and remain somewhat elevated, which just gets at this really difficult situation facing the Fed where they're really trying to fight a two- front war, right?

They're trying to fix the job market and they're trying to defeat inflation at the same time. It is really difficult. Now, as far as the voting here, this was actually almost unanimous. It was an 11-1 vote with Fed Chair Jerome Powell joined by 10 of his colleagues, including Fed Governor Lisa Cook, who the president has tried to fire. The one dissenter is the Federal Reserve's newest member. That's Stephen Miran, the Trump loyalist and White House economist. Not surprisingly, he was in favor of a bigger cut of half of a percentage point.

Now looking forward, the key change with the Fed's projections is they're now penciling in a total of three interest rate cuts this year, today's and two more quarter point cuts. Now that's a shift from June when Fed officials had previously just penciled in two interest rate cuts. Now, what does all this mean to everyone at home?

Well, the fact that rates have come down, that could be helpful for people who have credit card debt and people have floating rate debt, like home equity lines of credit. But we should be clear, this is not a silver bullet that's going to fix the economy. Interest rates do remain high. The Fed spiked interest rates three years ago to try to fight inflation, that amounted to slamming the brakes on the economy. Now, they're not going pedal to the metal and hitting the gas. They're sort of gradually taking their foot off the brake.

Now, later this hour, Fed Chair Joe Powell, he's going to take questions. I'm interested to hear what he's going to say about all of the pressure, the political pressure from the White House on Federal Reserve officials, and how many more interest rates he expects to have in the coming months. Back to you Brianna.

[14:05:00]

KEILAR: All right, Matt Egan. And we're watching the markets respond here. The vertical axes actually just got -- we just had to extend that in the graphic to make room for how they're reacting there on Wall Street. Matt, at the Fed, thank you so much for that. Boris?

SANCHEZ: Let's get some analysis now with Aaron Klein. He served as Deputy Secretary of the Treasury Department in the Obama administration. He's now a Senior Fellow at the Brookings Institution. Aaron, thanks so much for being with us. A quarter of a percentage cut, what do you make of it?

AARON KLEIN, DEPUTY SECRETARY, TREASURY DEPARTMENT UNDER OBAMA: So, look, that's a lot what the market expected. There was some people that thought it was going to be 50, that's clearly what Trump's new appointee wanted. But the Fed is going to be measured as they move forward because they're dealing with a difficult economy when you're setting monetary policy, stubbornly high inflation in a weakening economy, and an eroding jobs market. So 25 basis points is probably what most folks were expecting.

SANCHEZ: You mentioned stubbornly high inflation. It's still over that 2 percent goal. How confident are you that they can navigate through that? KLEIN: Well, look, it's very difficult. The Federal Reserve is trying to hit these two targets at the same time. Stable prices, which they've defined as 2 percent interest rate and full employment. And that's a difficult circumstance for anybody to navigate, let alone in this shifting economy. Look, you have the president putting tariffs on, putting tariffs off, juicing the economy with tax cuts, large deficit spendings, uncertain way that the economy has structurally rebounded post COVID. It's a tough act for anybody to follow.

SANCHEZ: No offense to anyone who watches these Fed meetings with bated breath, but usually they're not as dramatic as this one.

KLEIN: Yeah.

SANCHEZ: Why so much drama?

KLEIN: Well, President Trump is trying to take over the Fed in a way that no president has done that since FDR and maybe before. Look, he just appointed his sitting White House Chief Economist who didn't even resign from the White House, completely unprecedented in the modern era, who then went and dissented on his first meeting. Look, the Fed went almost 20 years without a single Federal Reserve governor dissent. At the same time, Trump is holding an apprentice style audition to be the next Federal Reserve Chair, including multiple voting members.

I was very intrigued that two of them, Governor Wallace who's considered a front runner and Governor Bowman who's kind of on the list of possible, but second-tier candidate, both supported Jay Powell and the quarter rate point. So they're deviating from Miran, who is kind of the president's marker in a way that nobody else has done to the board.

SANCHEZ: Miran voted for a half of a percentage point cut. Would that have been too drastic?

KLEIN: I don't think so. I mean, it would've been a step, it would've juiced the markets in the short term. Look, the Fed has said they're going to go down 75 basis points over the rest of the year. What -- I think Matt did a good job teeing up for people as the markets jump immediately on this. But the real economy, it takes six, 12 months for the Fed's changing of interest rates to show up in big broad measures like GDP and kind of the core economy. So, 50 basis points would've been a lot of gas to inject, but it wouldn't have been crazy talk.

SANCHEZ: So we are expecting to hear from Jay Powell shortly. Do you think he has to give a strong defense of Lisa Cook right now, who the president is actively trying to fire?

KLEIN: Yeah. Look, I've been very disappointed in the way the Fed has failed to defend its own independence. Jay Powell and the entire board didn't even confirm publicly whether Cook was a governor or not for the almost two weeks that the litigation came forward. They used this gobbledygook that we're a transparent entity, but we can't tell you who our members are. Look, I -- to some degree, the Fed has shown the courage of an ostrich in the face of this Trump onslaught. Now look, I think that's strategic on Chairman Powell's part. I think he thinks that the lower profile he can do, the better he can weather the storm, kind of batten down the hatches. I just wish the Central Bank would be showing a little more spine in defending its independence. It's put a lot of people, myself included, as a strong Fed critic, in a bit of an odd position of defending an institution which I think has a lot of structural flaws.

SANCHEZ: Interesting. We'll be watching what Powell says. Aaron Klein, thanks so much for the analysis. Appreciate it.

KLEIN: Thanks.

SANCHEZ: Still to come, grilled again, FBI Director Kash Patel facing tough questions from lawmakers for the second day in a row. Some fiery moments full of expletives. But first, we're following the fallout after damning testimony from Dr. Susan Monarez, the ousted CDC Director, detailing the pressure she says that she faced over vaccine policies. That and much more coming your way on CNN.

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[14:14:11]

SEN. BILL CASSIDY, (R-KY) CHAIRMAN, SENATE COMMITTEE ON HEALTH, EDUCATION, LABOR & PENSIONS: Did he ever communicate he was going to change the childhood vaccination schedule?

DR. SUSAN MONAREZ, FORMER CDC DIRECTOR: In the -- in -- not until that very day. In that morning meeting, he said that the childhood vaccine schedule would be changing starting in September and I needed to be on board with it.

CASSIDY: To be clear, he said there was not science or data, but that he still expected you to change the schedule?

MONAREZ: Correct.

(END VIDEO CLIP)

KEILAR: Just one of the captivating moments on Capitol Hill as ousted CDC Director, Susan Monarez faced Senators for the first time since HHS Secretary Robert F. Kennedy fired her. Monarez, right there, describing a moment she says Kennedy wanted her to rubber stamp vaccine guidance that she feared would harm kids. In all, men would lead the CDC for just 29 days after her Senate approval hearing where Democrats voted unanimously against her confirmation. One of those Democrats today apologizing.

[14:15:00]

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SEN. TIM KAINE, (D-VA): Dr. Monarez, I owe you an apology. When you were here for your confirmation hearing, I questioned you very significantly not on your qualifications. You got over the qualifications bar easily, but my worries about the direction of HHS made me question you very significantly on your backbone.

MONAREZ: You did?

KAINE: A trait that is not in long supply in this town. And then when I voted against your confirmation, I cited that as the reason. Again, no concern about your qualifications. I had concern about your backbone and I was wrong, and I apologize to you for being wrong.

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KEILAR: With us now is Dr. Paul Offit, Director of the Vaccine Education Center at Children's Hospital of Philadelphia. Dr. Offit, you listened to this testimony. How alarming was what Monarez, the former CDC Director, how alarming was it, what she testified to today?

DR. PAUL OFFIT, DIRECTOR OF VACCINE EDUCATION CENTER, CHILDREN'S HOSPITAL OF PHILADELPHIA: Very alarming. I mean, what's become very clear is if you're going to work with Robert F. Kennedy Jr. in his Department of Health and Human Services, you have to toe the line. You have to buy into his fixed, immutable, science-resistant beliefs that vaccines are causing harms that they don't cause. And if you don't, then you're out. And he showed that in other ways.

When he first came on as secretary, he met with Peter Marks, who was the head of CBER, the Center for Biologics Evaluation and Research, which is a part of FDA that evaluates vaccines and biologicals. And he said to Peter Marks, I want you to show me data that the measles vaccine causes blindness and deafness. And Peter Marks said, there are no data. The vaccine doesn't do that. And he was fired. So this is what we're dealing with now.

KEILAR: That apology from Senator Kaine was really something. Democrats unanimously voted against Susan Monarez's confirmation. Today, I mean, you heard them, they were calling her as well as CDC officials who resigned heroes. What did you think about that?

OFFIT: I think, I'm sorry, say that again, Brianna. In terms of asking her to resign? Say that again.

KEILAR: Well, no. There was an apology from Senator Tim Kaine and Democrats had unanimously voted against her confirmation. But today, we were hearing them, more than one of them calling her a hero, calling CDC officials who had resigned heroes. What did you think about that?

OFFIT: Right. She's a hero. She is a hero. I mean, in rarefied times when it's very hard to find anybody sort of to stand up for their principles, she did. And I think she should be congratulated for it, as did Dr. Houry and Daskalakis. I mean the Demetre Daskalakis. I mean, all of those people sort of stood up and said, this isn't good for the public's health and we're -- that's not why we're here. And I think, at some point, somebody has to step forward and say that Robert F. Kennedy Jr. is a danger to the American public. And no one has really done that yet.

KEILAR: So, there's this meeting tomorrow that is so key. This is the CDC Vaccine Advisory Council, which is known as ACID. And this is a highly anticipated meeting that they're going to have tomorrow and on Friday. It's about vaccines for COVID, Hepatitis B, Measles, Mumps, Rubella, and also Varicella or chicken pox as it is commonly known men. Monarez testified today that RFK Jr. directed her to commit in advance to approving every ACID recommendation regardless of the scientific evidence. Knowing that, should we trust the outcome of this meeting?

OFFIT: No, I think we would've trusted it had not RFK Jr. fired 17 people who worked for the ACIP, who had an expertise, who had experience, who were experts in the field and would give us good advice. He fired them. He replaced them with his kind of people. People who have an anti-vaccine bias, an anti-science bias, or to some extent conspiracy theorists. Those are his people. Those are the people who are going to say the kind of things he wants to hear. Like, let's eliminate the birth dose of Hepatitis B. Let's not have COVID vaccines for healthy young children. Let's not have COVID vaccines for pregnant people.

And so, I think that is what worries me, is that now he's got all his ducks in a row. At the last meeting, you had a vote against Thiomersal containing influenza vaccines. That was an anti-science vote. And I think it is the first of many. And now, no one is paying attention to the ACIP or the CDC who is in the medical or science world, and we're just trying to deal with the damage instead of looking to them for sound advice.

KEILAR: What are you seeing right now among kids as the school year is getting underway, when you're looking at flu shots, for instance?

OFFIT: I think more and more parents are choosing not to vaccinate their children for non-medical reasons.

[14:20:00]

I think at some level, some parents are emboldened by the fact that someone like Robert F. Kennedy Jr., who is anti-vaccine, is in that position. They would argue and understandably, why would he be there unless he wasn't to some extent, right? Maybe vaccines are unnecessarily dangerous, maybe we don't need them. And you're seeing now an erosion in vaccines to the point that we have the biggest measles outbreak we've had in 33 years, probably at least 5,000 cases of measles in this country.

We've had 270 deaths from influenza. We haven't seen a number that big since the 2009 swine flu pandemic. And we've had, and this has gone under the radar, about 10 deaths from pertussis in infants this year. Last year, totally, we had two deaths. This is getting worse and worse. And as long as he is in that position, as long as RFK Jr. is in the position to beat the anti-vaccine drum as head of HHS, it's a dangerous time to be a child in this country.

KEILAR: Dr. Paul Offit, we appreciate you being with us. Thank you. It is a split screen moment in the U.K. At Windsor Castle, it is pomp and circumstance. But in Central London, mass protests. Next, how President Trump is being sheltered from public disapproval of his state visit.

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[14:25:52]

SANCHEZ: Pomp and pageantry on full display today as Britain's Royal Family hosts President Trump and First Lady Melania at Windsor Castle. A series of firsts marking Trump's historic second state visit, including a fly past of the red arrows, leaving streams of red, white, and blue in the gray skies above. But the president's visit is also being met with demonstrations. These are live pictures of protests happening right now in Windsor.

CNN's Nic Robertson joins us now live from London. And Nic, you were in the crowds earlier today. What did you hear from these demonstrators?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yeah, this was a big demonstration organized in the center of London. It began shortly after midday. It walked all the way through the central London, down the main shopping avenue, Regent Street, all the way down past Trafalgar Square, past the Prime Minister's office, past the defense ministry, all the way to parliament. I'd say there's about 5,000 or so people there. 1,600 police, by the way, put out to keep control and keep law and order in place.

But there wasn't -- there wasn't sort of any aggression. It was -- it was by and large a well-natured crowd if you like. But the messages were stuck and they were clear. This crowd did not want President Trump in the country at all, saying no to Trump, no to racism, no to fascism. Connecting him to what's going on in Gaza, telling him, real messages there placards, telling him to stop Israel using U.S. weapons in Gaza. There were messages there about Jeffrey Epstein, associating President Trump with Jeffrey Epstein. And I spoke to a couple of people holding those placards.

One of them, by the way, was dressed as a dinosaur. And they said, look, specifically we know that this is an issue for President Trump in the United States, his association with Jeffrey Epstein, and we're not going to let him escape it when he comes here to the U.K. And the one lady told me, look, I work in healthcare. I have two young girls. I'm a woman. We care about what the leader of the free world says and does about his association with a convicted pedophile like Jeffrey Epstein. So, there was a whole range of messages there. But of course, President Trump was dozens of miles away. Won't have seen it. Won't have heard it.

SANCHEZ: And Nic, can you talk to us about the security surrounding his visit and obviously, the decision to hold today's events at Windsor Castle?

ROBERTSON: Part of it was always going to be because of President Trump's last visit to the U.K. during his first term in office, where there were these huge protests in the center of London. And it was very clear that protest organizers would try to leverage any time he had in the center of London to get out of really big crowds, to try to stop his progress, to try (inaudible) the center of the city up. Parliament went on recess yesterday, so there was no need to sort of have meetings with the prime minister or have anything related to parliament while he was in town.

Buckingham Palace is getting a renovation. So Windsor Castle became the sort of preferred venue for meeting with the royals. So that really meant that everything could be kept out of the Central London. But you saw just earlier today that that carriage procession that President Trump was in at Windsor Castle was inside Windsor Castle. That was for security reasons and security has been stepped up in the U.K. and it has been higher than previous visits. And that's a real nod to the fact that there have been attempts on the president's life and a recognition that no chances can be taken. I've been to several locations where the president has been and compared to previous visits, yeah, security is up.

SANCHEZ: Nic Robertson, thank you so much for the update from the U.K. Lawmakers on Capitol Hill questioning FBI Director Kash Patel for a second day, repeatedly asking him if President Trump's name is in the Jeffrey Epstein files. We'll bring you his response right after this.

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