US EditionFed minutes show officials were in tight split over December rate cut
Fed officials voted 9-3 for a 0.25% rate cut amid inflation above 2% and rising unemployment, reflecting deep divisions on balancing economic risks, minutes show.
- On Tuesday, the Federal Reserve released minutes from its Dec. 9-10 meeting showing a closely contested decision, with the FOMC approving a 0.25 percentage point cut by a 9-3 vote that lowered rates to 3.5%-3.75%.
- Officials weighing labor-market risks versus inflation concerns said some backing a cut found the choice finely balanced while the faction favoring keeping rates steady cited stalled progress toward the Committee's 2 percent inflation objective.
- Projections and liquidity steps included the committee's dot plot signaling rate cuts in 2026 and 2027 toward near 3%, while the FOMC approved resuming short-term Treasury bills at $40 billion a month.
- Liquidity and personnel shifts may influence near-term policy as the Fed warns reserves could fall below its 'ample' regime without resumed bill buying, while four incoming regional presidents oppose further cuts.
- Economic data show strong growth, with GDP rising at a 4.3% annualized pace and the broader U.S. economy performing well, while officials noted inflation remains short of the Fed's 2% inflation target and future cuts in 2026-2027 depend on expected inflation declines.
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99 Articles
St Louis Post-Dispatch
Fed minutes show split on key interest rate cut
WASHINGTON — Some Federal Reserve officials who supported cutting a key interest rate earlier this month could have instead backed keeping the rate unchanged, minutes released Tuesday show, underscoring the divisions and uncertainty permeating the central bank.
West Hawaii Today
Deep divide inside Fed raises questions about timing of further rate cuts
Federal Reserve officials are grappling with two fundamental questions as they confront both rising unemployment and elevated inflation. How much more should they lower borrowing costs, and when should they deliver that relief?
Times of India
The Economic TimesA split decision: How the Fed narrowly agreed to cut rates
Federal Reserve minutes reveal deep divisions behind Decembers rate cut, with policymakers split over inflation risks, labour market cooling and the need for further easing amid limited data visibility.
US Fed minutes show most officials expect additional rate cuts
Minutes of the Dec. 9-10 Federal Open Market Committee gathering, released Tuesday in Washington, pointed to the difficulty policymakers faced in their most recent decision, which modestly reinforced expectations the Fed will hold rates unchanged when they meet again in January.
It is believed that Trump will soon be able to announce his appointment to occupy Powell's place, which he himself appointed for the task in 2018 and which was then supported by former President Joe Biden in 2021.
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