7 sources·Business

Federal Reserve Slows Interest Rate Cuts Amid Inflation Concerns

The Federal Reserve's December meeting minutes reveal cautious approach to interest rate cuts due to inflation risks and uncertainty from the incoming Trump administration.

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Updated: Jan 8th, 2025, 7:00 PM ET

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The Federal Reserve has decided to slow the pace of interest rate cuts, reducing its key rate by a quarter-point to approximately 4.3%. The minutes from the December 17-18 meeting highlighted a divide among policymakers, with some urging to maintain rates unchanged. The Fed's officials expressed concerns over persistent inflation, projecting only two rate cuts in the coming year as opposed to an earlier forecast of four. Anticipations of the economic implications of President-elect Trump's policies on trade and inflation contributed to this shift in stance, leading to heightened caution among the officials.

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