Fed Minutes: Disagreements Continue on Interest Rate Cuts

Fed Minutes Released: Divergences in Interest Rate Cuts

The minutes of the Federal Open Market Committee (FOMC) meeting held by the U.S. Federal Reserve on October 28-29 have been published. These minutes indicate that there are significant differences of opinion among committee members regarding interest rate cuts. Despite the decision to lower the policy interest rate to the range of 3.75% to 4.00%, different viewpoints on the bank's future actions have emerged.

Diverse Views on Interest Rate Cuts

The minutes indicate that various opinions were expressed regarding the extent to which the current monetary policy is restrictive. Some Fed officials argue that despite the 25 basis point cut made in October, the monetary policy remains restrictive, while others point out that due to the resilience in economic activity and more favorable financial conditions, the policy is not clearly restrictive.

Discussions on December Policy Decisions

Based on the information in the minutes, strong differences of opinion were expressed regarding what policy decision should be made at the meeting in December. Some officials suggested that if the current economic outlook continues without deterioration, further interest rate cuts may be appropriate, while others believe that keeping the interest rate steady until the end of the year would be a more prudent approach.

The decision to cut rates by 0.25% at the October meeting was approved by 10 votes to 2. This situation indicates that there are deep differences of opinion that could impact the Fed's future interest rate decisions.