The US Federal Reserve's latest interest rate cut has sparked cautious optimism across capital markets, but cannabis operators say the impact on their businesses will be modest at best.
The Fed lowered its key lending rate by 0.25 percentage points to a range of 3.75% to 4%, marking the lowest level in three years and the second cut in two months, the BBC reports. The decision comes amid a stalling US labour market, with hiring slowing and the unemployment rate edging up, compounded by the nearly month-long government shutdown that has delayed official data and left central bankers "flying blind," according to economists the BBC.
Industry reactions
Anthony Coniglio, CEO of NewLake Capital Partners, described the cut as "welcome news" for operators carrying floating-rate debt, though he noted that many businesses still face double-digit borrowing costs. "A 25- or 50-basis-point cut is incremental rather than transformational," Anthony said. He added that lenders and real estate investors may see improved portfolio spreads and tenant credit quality, while extended easing could reignite interest in cannabis debt and equities ahead of a wave of refinancing in 2026 and 2027. Still, he stressed, "monetary policy alone won't drive sustained growth" without federal reforms on banking, 280E, and scheduling.
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Terry Mendez, CEO of Safe Harbor Financial, pointed out that lower rates usually stimulate investment, but cannabis operators remain largely excluded from these benefits. "Until Congress enacts comprehensive cannabis banking reforms, including passage of the SAFER Banking Act, the industry will remain locked out of these economic tailwinds," he said.
The same sentiment was echoed by other cannabis companies. Gibran Washington, CEO of Ethos Cannabis, called the rate cut "limited, indirect relief" for the sector, noting that federal illegality continues to force operators into high-cost financing while 280E prevents them from deducting ordinary expenses. Washington emphasized that meaningful progress depends on federal reform: "The DEA's review of cannabis scheduling holds far greater potential impact than any rate adjustment."
JP Doran, CEO of Crucial Innovations, said the cut is a "welcome signal of easing conditions" that could help international expansion and ease liquidity pressures, but true cost-of-capital relief will only come from regulatory and banking reforms. Similarly, Adam Stettner, CEO of FundCanna, pointed out that most cannabis businesses lack access to conventional credit, meaning lower rates do not directly translate into cheaper borrowing.
In other words, rate cuts may offer temporary relief and encourage investment in the cannabis sector, but meaningful change hinges on rescheduling, banking reform, and tax relief.
