US EditionFed minutes show officials were in tight split over December rate cut
Fed officials narrowly approved a 25 basis point cut, projecting further reductions in 2026 and 2027 while restarting Treasury bill purchases to support funding markets.
- 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.
34 Articles
34 Articles
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? Minutes from the Fed’s final gathering of 2025 in December, released on Tuesday, underscore the difficult task facing Jerome H. Powell, the chair, as he tries to forge a consensus among policymakers after a series of incr…
Fed officials showed deep divisions at December meeting, minutes show
The U.S. Federal Reserve agreed to cut interest rates at its December meeting only after a deeply nuanced debate about the risks facing the U.S. economy right now, according to minutes of the latest two-day session.
Associated Press News
December interest rate cut was a close call for some Fed officials, minutes show
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.
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