“LESS DISSENT”
“While the Fed has been politically pressured to cut rates, it is not pressed by the data,” said EY-Parthenon chief economist Gregory Daco.
Officials appear to have converged on a near-term halt in rate reductions, with their debate now centreing around what conditions justify further cuts – and how quickly these should take place.
“The hurdle for additional near-term cuts has risen,” Daco said.
Officials will be looking for “clearer, more durable evidence of disinflation” or renewed deterioration in the labor market before lowering rates again, he added.
The Fed has seen deepening divides over interest rates, but Dan North of Allianz Trade North America told AFP that he expects “less dissent” in Wednesday’s decision.
Fed Governor Stephen Miran, appointed by Trump last year to fill a term lasting until late January, is likely to again push for lower levels, North said.
But it is unclear if others on the board of governors like Michelle Bowman and Christopher Waller would join him.