WASHINGTON -- The US Federal Reserve on Wednesday decided to lower the target range for the federal funds interest rate by 25 basis points to 3.5 to 3.75 percent, marking its third rate cut this year.

The latest move was widely anticipated, making it the third rate cut in a row since the Federal Open Market Committee monetary policy meeting in September.

"Uncertainty about the economic outlook remains elevated. The Committee is attentive to the risks to both sides of its dual mandate and judges that downside risks to employment rose in recent months," the Fed said in a statement.

The statement also noted moderate economic expansion, a higher unemployment rate, elevated inflation and more recent indicators consistent with those developments.

The slowdown in job creation and rise of unemployment rate in recent months prompted the Federal Reserve to resume cutting rates in September, though inflation remained near 1 percentage point higher than the Fed's target of 2 percent.

Data recently issued by Automatic Data Processing, Inc. (ADP) showed that US private companies cut 32,000 workers in November, defying economists' expectations for an increase of 40,000 for the month.

Small businesses with fewer than 50 employees lost 120,000 jobs in November, while mid-sized and large establishments continued to add jobs in the period, according to ADP.

US policymakers face extraordinary challenges as the 43-day federal government shutdown not only worsened the job markets but also disrupted the collection of macroeconomic data.

The US Bureau of Labor Statistics is scheduled to release the employment data for November on Dec 16, and the unemployment data for October will not be available due to the partial government shutdown in October and early November.