The Federal Reserve released minutes from the latest monetary policy meeting, showing a desire for further interest rate cuts while aiming to reach the 2% inflation target. Inflation metrics were higher in August, with the CPI up 2.9% and PCE up 2.7% year over year.

Fed Chair Powell emphasized risks to inflation and employment, with concerns about tariffs and persistent inflation. Policymakers noted that higher tariffs could push inflation away from the 2% target. Some policymakers believed the uptick in inflation warranted keeping rates unchanged.

Despite concerns, the FOMC proceeded with interest rate cuts due to labor market weakening. Most participants agreed that the Committee was well-prepared to address economic developments following the rate cut.

Fed Governor Stephen Miran voted for a 50-basis-point cut, dissenting from the panel’s vote. Policymakers had varying views on future rate cuts, with many expecting further easing throughout the remainder of the year. The market anticipates additional 25-basis-point cuts in late October and mid-December.

LPL chief economist Jeffrey Roach predicted tariffs would keep inflation pressures high, not reaching the target until late 2027. He suggested investors expect two more cuts this year, but a pause at the January 2026 meeting. Market futures may provide a more accurate prediction than the FOMC’s projections.

Read more at Yahoo Finance: Fed minutes show policymakers remain concerned about inflation as they weigh rate cuts