Fed Officials Split on Rate Cuts: How Many will the Future Hold?

Federal Reserve officials were split on interest rate cuts at June meeting, with concerns over inflation and labor market strength. Minutes showed a wait-and-see approach, but a growing divide on future policy. Some officials see rate cuts as likely this year, but debate on how far they should go.

Opinions range from next cut as soon as July to no cuts this year. Some officials see current rate close to neutral, suggesting only a few cuts ahead. Projections updated to show two cuts this year and three more over next couple years. Trump continues to pressure Fed for aggressive cuts.

Fed Chair Powell maintains cautious approach, emphasizing need for more data. Policy seen as well-positioned to respond to changes. Officials agree on taking careful approach in adjusting monetary policy. Facing difficult tradeoffs if inflation persists and employment weakens.

Trump’s tariffs have not significantly impacted prices, with CPI showing minimal increase in May. Public sentiment less fearful of inflation. Officials note tariffs may have limited effect on inflation with trade deals, supply chain adjustments, and other margin adjustments. Job growth slowing, but nonfarm payrolls still surprising economists. Consumer spending declining, with personal expenditures and retail sales down in May.

Read more at CNBC: Most Fed officials see rate cuts coming, but opinions vary widely on how many, minutes show