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Fed minutes show divide over October rate cut and cast doubt about December
Fed officials split on whether to cut rates in December due to conflicting views on inflation persistence and labor market softness, with a 10-2 vote for a recent 0.25% cut.
- After the October meeting, the Federal Reserve's minutes showed the FOMC approved a quarter-percentage-point cut to a 3.75%-4% range with a 10-2 vote but revealed division over the Dec. 9-10 meeting.
- Fed officials split over economic threats: they debated whether a weakening labor market or persistently elevated inflation posed the greater risk, amid missing data from the 44-day government shutdown.
- Within the committee, notable dissent surfaced as the minutes reflected multiple camps with several participants seeing a December cut as appropriate while many ruled it out, investors pared bets to less than a one-in-three chance, Stephen Miran favored a half-point cut, and Jeffrey Schmid opposed cuts.
- The FOMC also halted balance-sheet runoff by agreeing to stop reductions in December, leaving over $2.5 trillion in assets, which affects borrowing costs for borrowers.
- Looking beyond December, many participants still see further cuts likely in coming months, with market odds for a January cut around 66%, though Jerome Powell said a December cut is not a 'foregone conclusion'.
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Total News Sources97
Leaning Left11Leaning Right10Center37Last UpdatedBias Distribution64% Center
Bias Distribution
- 64% of the sources are Center
64% Center
L 19%
C 64%
R 17%
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