Fed treating Trump like the unstable non-genius that he is
https://www.cnbc.com/2025/01/08/fed-minutes-january-2025.html
“Almost all participants judged that upside risks to the inflation outlook had increased,” the minutes said. “As reasons for this judgment, participants cited recent stronger-than-expected readings on inflation and the likely effects of potential changes in trade and immigration policy.”
FOMC members voted to lower the central bank’s benchmark borrowing rate to a target range of 4.25%-4.5%.
However, they also reduced their outlook for expected cuts in 2025 to two from four in the previous estimate at September’s meeting, assuming quarter-point increments. The Fed cut a full point off the funds rate since September, and current market pricing is indicating just one or two more moves lower this year. Traders are assigning a nearly 100% chance that the FOMC will stand pat at its Jan. 28-29 meeting, according to the CME Group’s FedWatch gauge.
Minutes indicated that the pace of cuts ahead indeed is likely to be slower.
“In discussing the outlook for monetary policy, participants indicated that the Committee was at or near the point at which it would be appropriate to slow the pace of policy easing,” the document said.