Divided Fed officials saw another two interest rate cuts by the end of 2025, minutes show

## Fed Officials Leaning Towards Rate Cuts in September

The Federal Reserve’s September meeting minutes reveal a strong inclination among officials to lower interest rates, primarily due to concerns about the labor market. Here’s a breakdown of the key takeaways:

• **Near Unanimity for a Cut:** There was widespread agreement among Federal Open Market Committee (FOMC) participants that a rate cut was warranted.
• **Disagreement on the Extent:** The main point of contention was the number of cuts, with some favoring two and others three reductions for the year.
• **Rate Cut Approved:** The committee voted 11-1 to lower the benchmark interest rate by a quarter percentage point.
• **Future Outlook:** Most officials believed it would be appropriate to ease policy further through the end of the year. Projections suggested one more cut in both 2026 and 2027.
• **Dissenting View:** Newly appointed Governor Stephen Miran favored a more aggressive approach, advocating for a half-point cut.
• **Labor Market Concerns:** Officials cited a weakening labor market and a shift in the balance of risks as reasons for the easing.
• **Tariffs Discussed:** The committee generally believed that President Trump’s tariffs would not be a major source of lasting inflation.
• **Market Sentiment:** A survey of market participants indicated that “around half” expect three total cuts this year.
• **Government Shutdown Impact:** The ongoing government shutdown could hinder the availability of key economic data, potentially influencing future decisions.

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